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Best Investments Strategies in a Recession

A perfect and recession-free investment doesn’t exist, but some strategies can help you a lot when it comes to improving your portfolio and to better cope with the recession.




Investing in a time of a recession can be scary for so many of us, but it doesn’t have to be that way if you know what to look for and how to invest in times like these. Choosing the best-investing strategy can be hard.

When it comes to choosing the right strategy you should ask yourself what you are trying to achieve during the time recession hits.

Investment Strategies in a Recession That are Considered Best

A recession is a time when we have a downturn in the stock markets and a shaky and unstable economy.

The economic growth is declining but some sectors still produce a steady increase, although the overall is falling. But in a time like this, you should prepare an investment strategy and be ready when the markets rise again.

Here are some of the best things to invest in when in recession:

Find some core companies

During a recession, you should find a core company that is financially stable and has reliable growth.

Experts say that you shouldn’t give up on stocks even if you might be willing to do that. Even when a recession hits and the economy is not stable some sectors are performing well and they provide the investors with nice incomes in return.  

Probably your best choice is to focus your investment in the healthcare, energy, utilities, and consumer goods sectors.

Even in a time of recession people will still spend their money on electricity, gas, medical care, food, and groceries. Nevertheless the state of the economy these stocks will do well. 

Choose only reliable dividend stocks

Investing your money in a reliable dividend stock can prove to be an excellent way to earn some passive income. When choosing dividend stocks search for companies with lower leverage ratios. This indicates that the company has a lower risk for the shareholder.

A perfect start for your search is the companies that pay out their dividends every year for 25 consecutive years or more, called dividend aristocrats. Coca-Cola, Johnson & Johnson, Target, PepsiCo, Walmart, and McDonald’s are just some of these companies that can easily survive the recession.

Buy some real estate

In times of recession, the value of the homes drops and it might be wise to buy some properties at a cheaper price. Then, you can rent the property and have a nice and steady income.

Usually, during a recession, the mortgage rates are higher. After some time the real estate value will start to increase again and you can sell it for profit. Buying real estate is a really attractive investment during a recession.

Invest in precious metals is always a good idea

Gold and silver are usually performing well during stock market slowdowns and a shaky economy. Although, during recessions, the prices for gold and silver are going up since the demands for the same rise.

The main reason why buying precious metals is considered a great investing strategy is because they are assets that don’t lose their value.

High yield saving accounts as a short-term plan

We live in a time when we have almost zero interest rates, but still, the high yield saving accounts will give you a little bit higher interest rate than a regular saving account, and also your money will be safe if a recession hits the economy. Often recessions don’t last very long and having cash is great for the short term.

Having cash opens some possibilities for you, but the downside is if you hold too much money the inflation will eat your money and you won’t be able to compensate with the interest rate from the saving accounts.

So keep your money in high-yield accounts, but also have in mind that this is good only as a short-term strategy.


Don’t panic and think in the long term if a recession hits the economy. It is very important to keep your focus and to choose the right investing strategy. Avoid investments that involve high risk and are not safe.

Sectors that you can invest in even in time of a recession are health care, real estate, utilities, communication services, energy, financial, industrials, materials, and information technology.

Even if you lose your job during a recession don’t be scared and start investing in yourself. You can improve your knowledge and skills by investing in yourself and that can help you find a better job tomorrow.

ALSO READ: Will Investing Make You Rich

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