Last Monday, July 19, investors experienced a mini market correction when the Dow Jones Industrial Average tanked over 700 points (2.1%), the S&P 500 dropped 1.6%, and the Nasdaq Composite sank 1.1%. By week-end, all the indexes had gained back most of what they lost, but it was possible that anyone who had money in the market thought that this might be the beginning of the big drop.

Let's face it: There's going to be a market correction some place, some time. That's just part of the normal cycle of the stock market. Since nobody knows when that will happen, it's best to always be prepared for it. Below, three Motley Fool contributors discuss where to put your hard-earned money so you can be prepared for that inevitable day.

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A King among market survivors

Eric Volkman: One type of company most likely to emerge from a market crash relatively intact is a purveyor of essential goods.

No matter the state of the economy, people are always going to need toothpaste and adhesive bandages. That's why my pick would be a company that not only thrives on selling such goods, but has also survived a great many economic peaks and valleys over its long existence: Johnson & Johnson (JNJ -0.02%).

The company is unique among blue chip stocks because it's a pharmaceutical company that also straddles the consumer goods sector. Its consumer health unit -- the one that houses medicine cabinet staples such as Band-Aids and Listerine -- is responsible for around 16% of its revenue.

The market for such essentials is quite solid and helps smooth out the results of the more up-and-down, larger pharmaceutical segment. It also keeps the money flowing in, and is a key reason the company is such a cash-generating monster year in and year out.

Speaking of pharmaceuticals, Johnson & Johnson continues to be a top player in that segment.

Its single-dose coronavirus vaccine is one of a mere three authorized by the U.S. Food and Drug Administration, and the only one-and-done solution of the trio. While recent research from both the company and outside entities conflict as to the vaccine's effectiveness against the delta variant currently on the rise, the company's vaccine remains a potent weapon against the spread of the coronavirus.

And the company doesn't ignore the business opportunities presented to it. A standout business for Johnson & Johnson lately has been medical devices, the sales of which leaped by 63% in the company's second quarter to hit nearly $7 billion. Medical devices now comprise nearly a third of the company's total revenue.

Another compelling reason to take shelter in Johnson & Johnson before and during a market crash is its rock-solid dividend, which currently yields a respectable 2.5%.

Johnson & Johnson is a Dividend King, one of the handful of S&P 500 stocks that has raised its payout at least once annually for a minimum of 50 years running. Consider how hard it is to run a successful business even for a few years in a row -- one successful enough to pay a dividend for more than half a century is a sturdy and very reliable overachiever, and should provide plenty of shelter from a market collapse.

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A cash-generation machine, even during challenging times

Barbara Eisner Bayer: When I think about surviving a market crash, I look for a company with two attributes: the ability to survive relatively unscathed, and the ability to continue paying a dividend so that my stocks generate cash no matter what's happening on Wall Street. Innovative Industrial Properties (IIPR -0.28%) has both characteristics.

First off, the company is a real estate investment trust (REIT), which is required to pay out at least 90% of its taxable income to investors in the form of a dividend. And second, it's in a relatively recession-proof industry -- marijuana. During the coronavirus pandemic in 2020, legal pot sales reached a record $17.5 billion, which was a 46% increase from the prior year. Apparently, when the going gets tough, the tough get high.

IIP doesn't sell marijuana -- rather, it owns properties that cultivate and process pot, and then leases them out for long periods of time. As of June, the company owned 72 properties spread across 18 states, including some of the largest cannabis markets in the U.S. like California, Florida, Illinois, and Pennsylvania. All of its spaces are currently rented, with a weighted-average lease length of 16.8 years. IIP's business is very stable, and its customers include young up-and-comers like Green Thumb Industries and Cresco Labs. If one of them goes under, IIP can easily lease out that space to another rising star.

Looking beyond its dividend, which is currently yielding 2.77%, IIP is growing. And growing. In its first quarter of 2021, it reported a 103% improvement in revenue from the prior-year quarter. Adjusted funds from operations (AFFO), which investors regard as a more accurate gauge of growth for REITS, also exploded to $38.4 million. This was a significant increase from the previous quarter's $17.8 million. And net income was more than double what it was in the first quarter of the previous year.

With companies like that in my stock portfolio, I can emotionally breeze through any pullback, recession, or market crash -- without turning to weed for support.

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Sometimes, the best offense is a great defense

Chuck Saletta: When it comes to dealing with a market crash, one of the most important investment tools you can have at your disposal is cold, hard cash. From an absolute return perspective, cash provides a terrible return most of the time, but during a market crash, its value and role shines brightly.

For a great example of the role cash plays in a crash, look no further than Warren Buffett during the 2008 financial meltdown. When the world was panicking and financing was generally drying up, Buffett had billions of dollars of cash available to him on his company's balance sheet. He put that money to use at terms that were only available to him because the market was crashing and financing was drying up.

And what did he buy? In general, shares and warrants in companies that had overall reasonably solid businesses, but which were at a near-term risk because they needed cash and couldn't get it any other way. The lesson is clear: As maligned it is and as low a return as cash provides when times are good, in a panic, it can be an incredibly powerful investing tool to have at your disposal.

Of course, we mere mortals will likely never see the billions of dollars that Buffett has at his disposal, but we can still see incredible value from having cash available to us. First and foremost, market crashes and job losses often go hand in hand. Should you lose your job around the time of the next market crash, having cash can keep you from being forced to sell your stocks when the market is low just to cover your bills. Not being forced to sell at the lows is a key part of participating in any recovery that may follow.

Almost as importantly, market crashes often give investors their best chance to buy strong companies at discounted prices. Imagine buying a powerhouse bank like Bank of America (BAC 2.14%) for under $4 a share. It's unthinkable today, but in February and March of 2009 -- in the depths of that financial meltdown -- it was quite possible to do so.

No, investors weren't getting a Buffett-type deal, but they were still getting amazing fire-sale prices that were only available if they had cold, hard cash.