In a survey, the majority of economic forecasters predicted U.S economic expansion would end in 2020. This means private-sector economists believe the next recession will occur in approximately two years. Recessions are difficult to predict and tricky to recognize even after they start.
Millennials aren’t strangers to economic recessions.
Unfortunately, because of The Great Recession, employment is much harder to find for millennials than any other age bracket. This generation also carries a significant amount of student loan debt. Also, today’s millennials are now also parents.
With an impending recession, the question becomes… how can a generation that never recovered from the first recession as students now prepare themselves for the potential devastation again as parents?
Winnie Sun, a U.S financial advisor and founding partner of Sun Group Wealth Partners, shares her perspective: “I still believe the market will continue to stay strong for at least the near term, and possibly, hopefully, beyond 2020.” Some economists also agree with Sun’s position.
According to Sun, it is important for millennials to take financial action now, worrying about what they can control within their household.
With regards to a recession, Sun advocates for millennials to change their perspective. She feels a recession could give a boost to the planning-minded millennial.
To take action, she recommends the following:
- Analyze their personal and family budget worksheets.
- List their top three financial goals, including those independent of their household and those which affect their family as well.
- Calculate their financial plan by speaking with a financial advisor, or figure out how much they have today and how much they need to have before retirement.
- Pay down all their personal debt (e.g. credit cards, etc.) before considering investment opportunities. (There are exceptions that can be discussed with a financial advisor, which include mortgages and student loans).
- Set money aside for both emergency and investing funds.
She concludes “don’t fear a potential recession. Be prepared for it and get ready to tackle your investments when and if it occurs.”