Recession fears have been sparked by a rocky stock market, a drop in consumer confidence and the threat of escalating trade tensions from President Trump’s tariffs. While recessions can be brutal financially, they’re not inevitable and many experts believe we will avoid a slowdown for now.
The term “recession” is defined by the National Bureau of Economic Research (NBER) as a period when the economy’s growth slows down, leading to decreased GDP. Recessions can be caused by a variety of factors, including oil price shocks, restrictive monetary policy, unexpected economic events and major technological changes that lead to layoffs. While individual downturns vary in length, they typically last a few months to a couple years.
If we do enter a recession, it could be the first one since the COVID-19 pandemic and the longest stretch between economic slowdowns in 16 years. That means many young adults have never experienced a drawn-out downturn, which can make it harder to find jobs, save money and pay off debt.
Hardly a day goes by without economists upping their recession predictions. But what does that actually mean for average Americans? And what steps can you take to protect yourself from a downturn? To help answer these questions, we talked to financial advisors.
About the Author
