In a recent poll, roughly 70% of Americans expressed satisfaction with the current state of the economy. And, in general, there’s a lot to be pleased about. The markets have performed well over the past year and many investors are riding high. However, as any experienced entrepreneur will tell you, what comes up will invariably come down.
Indeed, as this article points out, the performance of the stock market as a whole mirrors a pattern present in 1937. Furthermore, many prognosticators do believe that some sort of financial downturn is on the horizon –– though when, if, or how significant that will be is still just a matter of conjecture.
Fortunately, there are steps you can take to ensure your financial stability even during hard times. Here are several dynamic investment ideas that will help you manage your money during a recession or economic downturn.
Best Stocks to Buy During a Recession
Investing in the stock market is, under the best of circumstances, a risky proposition. Still, if the 2008 recession is anything to go by, certain brands thrive during adverse financial conditions.
One of the best investments to make in the wake of a recession is in alcohol. Both AB-Inbev and Miller-Coors saw an increase in beer sales and boosted their stock position during the 2008 recession. And historically, alcohol sales are recession-proof. People want their booze and a little fluctuation in the market isn’t going to change that. Furthermore, similar small consumer purchases –– like fast food, tobacco, clothing –– are unlikely to see a significant dip as a result of a recession. Lastly, businesses that specialize in selling discount items are solid investment ideas for hard times. People still need access to vital services and companies that can offer cut-rate prices will prevail in recessions.
Gold, real estate, wheat, and grain all hold physical, intrinsic value. As a result, that value tends to stay stable despite the movement of the market. Raw commodities like these are typically smart plays for investors looking for solid, if unspectacular returns.
Other Investment Ideas
Perhaps the best way to manage your money during a downturn is to diversify. As such, there are multiple ways to invest extra cash now to protect yourself later on.
Purchasing government stocks and bonds, opening savings accounts, and deciding to pay off your current debt are all smart ideas for investors playing the long game.
The Bottom Line
No one can accurately predict every move the stock market will make. A relatively obscure product like a cellmaster roller bottle may suddenly come into demand while more established products experience a lull. Stranger things have happened! The key isn’t to try and diagnose every trend, but rather, to develop a sensible investment strategy for all occasions. Do that, and you’ll never have to sweat the peaks and valleys the stock market creates.
Disclaimer: This content does not necessarily represent the views of IWB.