April Economic Showers: How to Weather Uncertainty With a Solid Financial Plan

They say April showers bring May flowers—but what’s the best move when the forecast indicates a chance of financial storms? This month we’re sharing a few tips on how to shore up your finances when economic uncertainty is on the horizon.

Map Out Household Expenses

The first step to building a budget is understanding your income and expenditures. Mapping out your household expenses is especially important in a time of economic uncertainty. If money suddenly becomes tight, or if essential living costs rise, you’ll want to have a good understanding of what monthly expenses can be cut. Track your purchases for a month, paying particular attention to any “hidden” costs such as entertainment subscriptions which are deducted automatically.

Start an Emergency Fund

The best time to start an emergency fund is yesterday, but the second best time is today. Experts recommend maintaining an emergency account that can sustain your living expenses for three to six months. Make sure these funds are easily accessible inside a checking or savings account, rather than an investment vehicle. And, if you can, trim some fat from your current household spending and put that money into your emergency fund. Even a few dollars per month can make a difference.

Pay Off Debt

Tariffs could cause higher interest rates, increasing the cost to borrowers with a variable-rate loan or credit card. If you have a variable-rate loan, or high-interest debt of any kind, now could be a good time to prioritize paying off this money. You can find plenty of debt management tips at blog.harvardfcu.org. A good place to start might be looking into a balance transfer credit card, to lock in a 0% APR for 12 months so you can pay down debt within accruing additional interest.

Consider the Timing of Big Purchases

Economists have been warning consumers that prices may rise in the coming months, particularly on larger items such as cars and home appliances. While there’s no crystal ball to say for sure what will and won’t happen, it could be worthwhile to consider shopping for big-ticket items sooner rather than later. But, as always, the best financial move depends on your unique financial situation. Evaluate your household budget and long-term financial goals to determine spending decisions.

Invest With Caution

When facing a rocky stock market, the smartest move is to speak with a financial advisor. Be wary of making any drastic moves, including selling or purchasing assets. Instead, work with a market expert to evaluate what the current market conditions mean for your long-term goals, then act accordingly. In many cases, this may mean doing nothing. Click here to see what investment services are available through Harvard FCU or to schedule an appointment with a financial advisor.