## Recession Talk Stirs Fear in the Public: What You Need to Know The Federal Reserve System (Fed) continues to suggest that it will raise interest rates to get a grip on inflation. Since the Fed controls the supply of money in the US, this action can lead to a recession. While recessions are a part of normal economic cycles, the general public often becomes anxious when there is talk of a possible recession. There are a few things that the public can do to prepare for a possible recession: * **Create a budget and stick to it.** This will help you to track your spending and make sure that you are not living beyond your means. * **Build up your savings.** This will give you a financial cushion in case you lose your job or your hours are cut. * **Reduce your debt.** This will make it easier to manage your finances if you do lose your job. * **Consider additional income.** This could be a part-time job, a side hustle, or selling items you don't use anymore. The Fed raising interest rates isn't the only factor that could lead to a recession, but it is a major one. Keep in mind that recessions are part of normal economic cycles.
To ensure the economy is resilient and sustainable, recessions are necessary to remove imbalances and inefficiencies. Cutting down inflation through raising interest rates is one way to create a healthy economy. This action is not meant to cripple the economy, but promote growth in the long run. Here are some additional tips for preparing for a recession: * **Protect your income.** If you are worried about losing your job, you should start looking for other sources of income. This could include starting a side hustle or freelance work. * **Cut back on unnecessary expenses.** Take a close look at your budget and see where you can cut back. This could mean dining out less often, canceling subscriptions, or reducing your travel expenses. * **Talk to your creditors.** If you are having trouble making your payments, you should contact your creditors and explain your situation. They may be willing to work with you on a payment plan. It is also important to remember that recessions do not last forever. The average recession lasts about 10 months. While a recession will cause some economic hardship, you can take steps to prepare for it and minimize the impact on your finances.
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