Don't Wait for the Headlines -- Act Like a Recession Is Coming Now

Whether or not we go through a recession anytime soon, there are a few simple things you can do now to prepare. And with weakened consumer spending and growing pessimism from CEOs and business leaders, now is as good a time as any to get ready.

By re-evaluating your mortgage and retirement savings and moving your money into a high-yield savings account (HYSA), you can give yourself a financial cushion to help you stay prepared for whatever comes next.

Protect your money with a high-APY savings account

As of right now, the national average savings rate is just 0.38%, according to the FDIC. That means if you're keeping your money in a typical savings account, it's not even keeping up with the rate of inflation.

The good news? The best high-yield savings accounts are offering APYs as high as 4.40%, which is more than 11 times the national average.

And unlike certificates of deposit (CDs), which lock up your money for months or years, a high-yield savings account gives you access to your cash anytime you need it -- making it the perfect place to store your emergency fund.

Check in on your retirement savings

You shouldn't overhaul your retirement plan just because a recession might be coming, but it is a smart time to make sure your investments are still on track.

Rebalancing your portfolio helps keep your risk level in check, especially when markets are shaky. It's also a good time to make sure your portfolio is diversified. You can spread your money across different industries and asset classes; that way, if one of them tanks, your retirement savings won't go down with it.

Finally, prepare yourself mentally. Market drops are stressful, but if you panic and sell during a crash, you may set yourself back years. If you have a diversified portfolio and a solid long-term plan, it's best to stay the course, even during rough patches.

Re-evaluate your mortgage

If you're a homeowner, it can also be helpful to take a fresh look at your mortgage. If your rate is higher than current market rates, and your credit is solid, refinancing could lower your monthly payments and free up cash for other needs.

You can also consider mortgage recasting. This involves making a large lump-sum payment toward your principal in order to lower your monthly payment. Your interest rate and your payoff date remain the same, but your lender recalculates your monthly payment based on the remaining balance. Many lenders allow you to recast your mortgage, but not all, so be sure to check. You'll likely need to pay a minimum lump-sum payment amount, such as $5,000 or $10,000.

Lastly, if you think you may need access to emergency funds, you could consider applying for a home equity line of credit (HELOC) now, before lenders tighten requirements in a downturn.

A HELOC comes with its own set of risks, though. Lenders can reduce or freeze it anytime, especially if you lose your income, and failing to make payments on time could put you at risk of foreclosure. It's best used as a backup, not your primary safety net.

Check out this list of our favorite refinancing lenders to find the one that works best for you today.

Prepare for the worst and hope for the best

If you're worried about what the economy might do next, start by re-evaluating your mortgage, making sure your retirement savings are diversified, and moving your cash to a high-yield savings account.

With the right money moves, you'll have much more stability in uncertain times -- and be prepared for the worst while still hoping for the best.