The thought of a recession can be a scary thing. We are constantly bombarded by the news that the worst is yet to come. The worst may yet come, but it hasn’t come yet. There is nothing wrong with being prepared, but it should not get in the way of making sound financial decisions. You never want to make any decisions out of fear, much less financial ones.
In this video, you will learn whether you should pay off debt or save for the worst.
If you are in debt, it is a guaranteed thing. A recession is not guaranteed to happen. Regardless of if it happens or not, you will still have to pay off your debt. Therefore, wealth management services will likely tell you to pay the debt off as soon as you can so that you can avoid paying additional interest payments. On the flip side, make sure you do have some emergency money saved up in the bank just in case. A good rule of thumb is to have three months of wages stored up in your bank in case worst comes to worst. This means that you could be out of a job for three months and still not feel the effects. If you are debt free with three months of savings, you will have a certain peace that you feel about your financial situation.
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