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PHNjcmlwdCB0eXBlPSJ0ZXh0L2phdmFzY3JpcHQiIHNyYz0iaHR0cHM6Ly9zdGF0aWMubXlmaW5hbmNlLmNvbS93aWRnZXQvbXlGaW5hbmNlX3ZpZXdwb3J0X2RldGVjdGlvbi5qcyIgLz48c2NyaXB0IGFzeW5jIHR5cGU9InRleHQvamF2YXNjcmlwdCI+bXlmaVdhdGNoV2lkZ2V0KCdteWZpV2lkZ2V0XzAnKTs8L3NjcmlwdD4=Lindsay Frankel is a Denver-based freelance writer specializing in personal finance and real estate content. Her work has been featured in publications such as Investopedia, NextAdvisor, BiggerPockets, Bankrate, and LendingTree. She graduated magna cum laude with a bachelor's degree in education from Elmhurst University. When she's not writing, you can find her playing music or exploring the outdoors with her rescue dog, Lucy. You can reach Lindsay at https://www.lindsayfrankel.com/.Hearst Television participates in various affiliate marketing programs, which means we may get paid commissions on editorially chosen products purchased through our links to retailer sites. This may influence which products we write about and where those products appear on the site, but it does not affect our recommendations or advice, which are grounded in research. Mobile app users, click here for the best viewing experience.Despite low unemployment and a resilient economy, most economists predict a recession in 2023, though it may come later than originally expected. Even if future Fed rate hikes don’t increase unemployment, it can’t hurt to prepare for a recession. If you lose your job or something happens with your financial situation, you’ll be more capable of weathering the storm. We asked the experts for tips on how to recession-proof your savings and investment strategies, so you can be ready. Build an emergency fundIn advance of a recession, it’s most important to bolster your emergency savings. That way you’ll have a cash buffer if your income changes or you incur an unexpected expense. “General financial planning theory suggests that an emergency fund should be 3-6 months of expenses in cash or cash alternatives,” says Max Sabert, private wealth advisor at UBS. “But during a recession, we like to target 6 months.” Eddie Martini, strategic financing and real estate investment advisor at Real Estate Bees, says he encourages clients to have a minimum of 12 months saved if they’re self-employed. If you’re an employee, he recommends a bare minimum of 3 months worth of expenses. If you don’t already have a budget, now is the time to create one. You’ll need to get a sense of your necessary expenses so you can decide how much to aim for in savings. Add up your fixed expenses every month (things that don’t change, like rent and cell phone bills) and build in some room for variable expenses, like food and gas, and multiply it by three to six. That’s your goal for your emergency fund.Stick to your budgetWhen a recession looms, it’s not the time to be dipping into your savings for an expensive night out. If you’re still working toward building your emergency fund, you should keep a lean budget — stick to your necessary expenses (groceries, mortgage payment, utilities, etc.) until your savings account is stocked. Once you feel confident that you have enough stashed away, you may be able to indulge in a fancy dinner or a new pair of shoes, as long as it fits within your monthly budget. Invest for the long haulMarket volatility is common during a recession, and no investment is completely safe from negative returns. What’s most important is committing to keeping your money invested for a long period. The market typically rises more days than it falls, so even if the value of your investments fluctuate in the near term, your money can grow significantly if you keep it in the stock market for the long haul. You should also ensure you have enough cash on hand to support your lifestyle, so you’re not tempted to liquidate your investments at a time when you’ll lose money. “Segmenting funds for your short-term spending needs can help you stay focused on your long-term goals, no matter what the markets are doing,” says Sabert. Diversify your investmentsSabert says asset classes tend to move together during a recession, so it’s important to diversify your investments across not just asset classes but also sub-asset classes. “For example, having both short duration treasuries and municipal bonds could be a strategy within fixed income that offers you diversification within the fixed income bucket.” You might consider investing in one or two of each of the following during a recession:Fixed-income: Treasury bills, notes, or bonds; municipal bonds; corporate bonds; CDsEquities: Mutual funds; dividend stocks; exchange traded fundsAlternative investments: Gold; commodities; peer-to-peer lendingReal estate: REITs; real estate crowdfunding; residential or commercial real estate; landConsider a high-yield savings accountIf you park your savings at a traditional bank, you could be missing out on free money every month. While the average savings account interest rate across financial institutions offers just 0.24% APY, according to Bankrate, some high-yield savings accounts are offering 4% APY or more. Here’s the difference that can make for your money: Let’s say you have $20,000 in savings. If you opt for a high-yield account, you could earn $800 or more in a year, instead of the meager $46 you’d get from a traditional savings account. But you shouldn’t necessarily just pick the account with the highest APY. You’ll also want to check the minimum balance requirements, evaluate any fees or penalties, and make sure the transaction limitations don’t prevent you from accessing your cash when you need it. Some high-yield savings accounts may include other features that are important to you, such as a mobile app or easy ATM access. Bottom lineIt’s difficult to prepare for uncertainty. But the more you save, the better chance you’ll have of staying afloat if your financial situation goes awry. In the current high-interest rate environment, it’s best to avoid borrowing, so budget to save more instead. Once you’ve stocked your emergency fund, consider a handful of diversified, long-term investments to help you meet your future goals. And keep your budget relatively lean so you have more money to grow, month after month. Editorial Disclosure: All articles are prepared by editorial staff and contributors. Opinions expressed therein are solely those of the editorial team and have not been reviewed or approved by any advertiser. The information, including rates and fees, presented in this article is accurate as of the date of the publish. Check the lender’s website for the most current information.This article was originally published on SFGate.com and reviewed by Lauren Williamson, who serves as Financial and Home Services Editor for the Hearst E-Commerce team. Email her at lauren.williamson@hearst.com.