Recession-Proofing Your Finances: How to Get Lean, Get Liquid, and Get Out

It’s becoming more and more clear we’re headed straight into a recession. With economic reports confirming GDP declines and signs of a slowing market, it’s time to stop wondering if a downturn is coming and start preparing for how you’ll navigate it.

The good news? You don’t have to sit back, freeze, and hope for the best. In fact, doing nothing is the worst thing you can do right now.

In this article, I’m breaking down the simple but powerful framework I teach my clients to protect and grow their wealth during uncertain times:

Get Lean. Get Liquid. Get Out.

Step 1: Get Lean

Getting lean doesn’t mean going full doomsday prepper or living off rice and beans. It means becoming a better steward of your money:

• Track your cash flow weekly or monthly.Know what’s coming in and what’s going out. Spot leaks before they become floods.

• Cut waste.Are there subscriptions or services you’re barely using? Eliminate them. This is the time to ask, “Does this actually improve my life or build wealth?”

• Rethink your savings contributions.If you’re funding your 401(k) while carrying high-interest debt or struggling with cash flow, it’s time to stop. Locking away money while you’re borrowing at 20%+ interest just doesn’t make sense.

Step 2: Get Liquid

In times of economic contraction, cash is confidence. You need capital you can access quickly. Here are some places I keep my liquid reserves:

• High-yield savings accounts.Not glamorous, but accessible. Look for rates around 4% taxable, but still better than traditional accounts.

• Infinite banking policies.These whole life policies are a powerful tool to grow tax-free wealth while keeping it accessible. Plus, they aren’t tied to the volatile stock market.

• Emergency reserves.Whether it’s in the bank or a safe, keep 6–12 months of expenses available. When others panic, your liquidity gives you leverage.

Step 3: Get Out

This is the part that really matters: repositioning your money to thrive while others simply try to survive.

If your money is sitting in the stock market, especially in high-risk equities or mutual funds, you’re exposed. Here’s what I recommend:

• Exit speculative positions.The market may rise, but it’s more likely to fall. Don’t bet your financial freedom on an unpredictable rollercoaster.

• Move toward fixed-income or stable-value options.These aren’t exciting, but they help you protect your capital while you wait for better opportunities.

Recession-Resistant Investments to Consider

So where should you put your money? Start by asking this question:

What’s not changing even in a recession?

Here’s what tends to hold up (and even grow) when the economy falters:

1. Rental Real Estate

People always need a place to live. In many markets, demand for rentals goes up in downturns. While not every property will cash flow immediately, they’re a powerful store of value and hedge against inflation.

2. Private Lending & Income Funds

Instead of borrowing from a bank, real estate investors often turn to private lenders people like you. You can earn 10–12% annually in the right deals, secured by real property.

3. Storage & Industrial Real Estate

As people downsize, they don’t throw things away they store them. Self-storage can perform well in recessionary cycles.

4. Land and Multifamily (at the right price)

Strategic purchases of land or apartment buildings especially in undervalued secondary markets can lead to strong long-term appreciation.

Bonus Tip: Protect What You Have Before You Try to Grow

Before you go gold hunting or chasing new opportunities, make sure you’ve shored up your foundation. That means:

• A healthy liquid reserve

• Minimal bad debt

• Multiple streams of passive income

And if you don’t have multiple income streams yet? That’s where we can help.

Final Thoughts: Don’t Sit on the Tracks

Recessions are inevitable. But financial disaster isn’t.

If you’re feeling nervous or unsure, that’s normal. But freezing and doing nothing? That’s what puts people in real trouble.

The smartest investors prepare before the train hits. They move their money out of high-risk zones and into assets that can weather the storm and come out stronger on the other side.