The Best 18 Tools and Strategies for Recession-proofing Your Finances
The Iran war has shaken the world economy by disrupting energy production and shipping, as the key chokepoint, the Strait of Hormuz, remains blockaded. The resulting volatility has raised the possibility of a global recession, the International Monetary Fund warned in a recently released report.
Even if the conflict is short-lived, the world will see the damage, per the report. The IMF expects, in the best-case scenario, that global growth will fall to 3.1% this year from 3.4% in 2025. That’s down from the 3.3% the IMF predicted in January, before the war began.
As for the pessimist view regarding the closure of the Strait of Hormuz, Citadel CEO Ken Griffin recently offered a chilling take: “Let’s assume it’s shut down for the next six to 12 months,” said Griffin at the Semafor World Economy event earlier this month. “The world’s going to end up in a recession. There’s no way to avoid that.”
There’s nothing you can do to stop a recession, but there are ways to prepare your finances by trimming costs—even on necessary spending—and finding extra money. CNBC Select outlines the best strategies and tools for preparing your finances.
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The best tools and strategies for recession-proofing your finances
How to cut costs on essentials
Fifty-six percent of American adults said everyday life is less affordable than a year ago, according to CNBC and SurveyMonkey’s Quarterly Affordability Survey. One way to alleviate this pain is to look for lower costs on necessities and essential expenses.
For example, investigate whether you can find a better car insurance rate. Prices for premiums have jumped 18% between this year and 2025, according to the car insurance comparison site The Zebra. While most states require some level of car insurance for people to legally drive, you may be able to find a better deal by comparing rates.
CNBC Select found Jerry, an AI-powered insurance shopping tool, was helpful for comparing quotes across several national companies. Users enter their personal information, such as credit scores and details about their vehicle, and Jerry spotlights inexpensive plans.
However, the platform focuses on national insurers, which may be more expensive than their regional or smaller counterparts.
Jerry.ai
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Highlights
Jerry is an AI tool that allows drivers to compare auto insurance policies from dozens of insurers in minutes. You’ll need to provide personal information, including your name, address, phone number and vehicle information, but it gives you estimated rates from several insurers.
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Availability
Jerry is a licensed insurance agency in all 50 U.S. states and Washington, D.C.
Pros
- Reduces the comparison shopping process to minutes, not hours
- Compares potential rates from dozens of insurers in one place
Cons
- Requires downloading the mobile app to see rates
Read more: These two AI-powered insurance shopping tools are worth a try
If you’re paying high interest rates on your credit card each month, consider moving your debt to a balance transfer card with no interest. CNBC Select recommends two for their 0% introductory APR.
The U.S. Bank Shield™ Visa® Card is well-suited for people seeking an extended repayment timeline. The card offers a 0% introductory APR on purchases and balance transfers for 21 billing cycles. After that, there’s a 16.99%–27.99% variable APR. While there is a $0 annual fee, the U.S Bank Shield card charges a 5% fee on balance transfers, which is higher than the typical 3%.
- Best-in-class intro-APR offers for purchases and balance transfers
- No annual fee
- Annual statement credit
- Cell phone protection
- Rewards limited to eligible travel purchases made through the U.S. Bank Rewards Center
- No welcome bonus
- Has a foreign transaction fee
- No intro balance transfer fee
The Citi Double Cash® Card offers a 0% intro APR for 18 months on balance transfers, followed by a variable APR of 17.49%–27.49%. You’ll pay a fee of $5 or 3% of the balance transferred, whichever amount is greater, but you’ll also earn 2% cash back on purchases: 1% when you buy something and 1% when you pay the monthly credit card bill.
The Citi Double Cash® Card is one of the best no-annual-fee cash-back cards thanks to its straightforward rewards structure.
- Long intro-APR for balance transfers
- High flat-rate cash-back rewards structure
- No annual fee
- Has a foreign transaction fee
- Intro APR doesn’t apply to purchases
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select’s editorial staff.
- Earn $200 cash back after you spend $1,500 on purchases in the first 6 months of account opening. This bonus offer will be fulfilled as 20,000 ThankYou® Points, which can be redeemed for $200 cash back.
- Earn 2% on every purchase with unlimited 1% cash back when you buy, plus an additional 1% as you pay for those purchases. To earn cash back, pay at least the minimum due on time. Plus, earn 5% total cash back on hotel, car rentals and attractions booked with Citi Travel.
- Balance Transfer Only Offer: 0% intro APR on Balance Transfers for 18 months. After that, the variable APR will be 17.49% – 27.49%, based on your creditworthiness.
- Balance Transfers do not earn cash back. Intro APR does not apply to purchases.
- If you transfer a balance, interest will be charged on your purchases unless you pay your entire balance (including balance transfers) by the due date each month.
- There is an intro balance transfer fee of 3% of each transfer (minimum $5) completed within the first 4 months of account opening. After that, your fee will be 5% of each transfer (minimum $5).
Balance transfer fee
There is an intro balance transfer fee of 3% of each transfer (minimum $5) completed within the first 4 months of account opening. A balance transfer fee of 5% of each transfer ($5 minimum) applies if completed after 4 months of account opening.
Foreign transaction fee
Loan options for when you’re in a pinch
If you’re facing a large, unexpected expense, a personal loan can help. Personal loans, which are often unsecured, may not require collateral but you’ll face higher interest rates than secured loans, which are collateralized.
Upstart offers accessible personal loans for people with fair or average credit.
- Accept applicants with low or no credit
- No early payoff fees
- Most loans funded the next business day
- High late fees
- Origination fee of 0% to 10% of the target amount
- $10 fee for paper copies of loan agreement
If you’re focused on keeping costs low, consider LightStream—it doesn’t charge origination fees, late payment fees or prepayment penalties. Loans range from $5,000 to $100,000, plus there’s a 0.50% discount for signing up for autopay. The APR ranges from 6.49% to 24.89% if customers sign up for autopay before the loan is funded, otherwise, rates are 0.50% higher.
LightStream Personal Loans offer low APRs, no fees and the ability to apply online
- Same-day funding available through ACH or wire transfer (conditions apply)
- Loan amounts up to $100,000
- No origination fees, no early payoff fees, no late fees
- LightStream plants a tree for every loan
- Requires several years of credit history
- No option to pay your creditors directly
- Not available for student loans or business loans
- No option for pre-approval on website (but pre-qualification is available on some third-party lending platforms)
Where to find extra money
If you’re looking to bring in extra cash, consider renting things you already own. For example, rent access to your backyard swimming pool with Swimply, a car you don’t use often via Turo, or your home on Airbnb.
If you don’t have or can’t spare one of the above, look at what miscellaneous items are in your possession. CNBC Select recommends using Hygglo to rent construction equipment, electronics, garden tools, party items and sports gear, among other categories. However, the platform charges a 20% commission from the rental, which goes toward covering insurance and guarantees, customer support and user verification.
Hygglo
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Fees
Collects a 20% commission from rental fee
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Availability
The app is available in both the App Store (for iOS) and on Google Play (for Android); there’s also a web version
Pros
- Offers Hygglo Care, which is essentially damage, loss and theft protection for lenders listing their items on the platform
- Lets you rent out a variety of items
- Verifies borrower’s identity
- App and web version available
Cons
- Takes a 20% commission from your rental fee
Depop
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Fees
For U.S. sellers, the standard transaction fee for Depop Payments is 3.3% + $0.45
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Shipping costs
Either the buyer or seller can cover the cost of shipping for shipping labels generated by Depop — costs depend on the weight and dimensions of your package. U.S. sellers can also choose to arrange their own shipping
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Availability
The app is available in both the App Store (for iOS) and on Google Play (for Android); there’s also a web version, but the app is more functional.
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How do you get paid?
Earnings from your sales are all paid into your Depop Balance. These earnings are then automatically transferred to your connected bank account.
Pros
- You only have to pay fees when you sell an item (no listing fees)
- You can post the listings and manage your shop all from your phone
- Offers a social feed for boosted visibility
Cons
- Does charge a fee
- You can’t use it for in-person deliveries or orders
- Funds are held until delivery confirmation or the waiting period elapses
Mercari
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Fees
Sellers pay a 10% fee for each item that’s sold. There’s also a payment processing fee of 2.9% plus $0.50. There’s also a $2 fee for each direct deposit transfer under the minimum of $10 or a deposit rejected by the financial institution. Each Instant Pay transfer is $3.
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Shipping costs
Either the buyer or seller can cover the cost of shipping; shipping labels are generated by Mercari and costs depend on the weight and dimensions of your package.
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Availability
Mercari has an app that’s available in both the App Store (for iOS) and on Google Play (for Android), and you can also list and shop via its website.
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How do you get paid?
After the transaction has been completed, the payment will show up on your Mercari balance. You can either have the money directly deposited into your bank account.
Pros
- You only have to pay fees when you sell an item (no listing fees)
- People who want to sell items locally can use Mercari Local
- You can post the listings and manage your shop all from your phone
Cons
- Mercari take a higher commission fee (10%) than some other resale platforms
- There’s a $2 if your direct deposit is less than $10
Bigger moves to make
To trim costs, you might consider refinancing your mortgage. While rates have jumped since the start of the Iran war, they’re still lower than the 8% homebuyers faced in 2023. CNBC Select recommends two lenders for their availability and low rates.
For homeowners who want a lower rate as soon as possible, consider Rocket Mortgage. Its average closing time for refinancing is 21 days — half the national average.
Rocket Mortgage Refinance
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Mortgage types
Conventional, FHA, VA, HomeReady, Home Possible, Rocket ONE+, jumbo, refinancing, VA Interest Rate Reduction Refinance Loan (IRRRL), home equity loan
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Terms
8 to 29 years for fixed-rate term
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Credit score requirement
580 for cash-out, rate-and-term, FHA or VA IRRRL
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Home equity requirement
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Availability
Rocket Mortgage offers refinancing in all 50 U.S. states and Washington, D.C.
Pros
- Can refinance second home or investment property
- Prequalification available in minutes
- Allows borrowers to cash out 100% of their home’s equity
Cons
- Doesn’t offer USDA loans, HELOCs, construction loans
- No physical locations
- Higher-than-average origination fees
Better boasts lower interest rates than many competitors and allows customers to roll lenders’ fees into the loan, so you don’t have to pay them upfront. However, check the math to ensure your rate is low enough so that adding the fees doesn’t result in a higher monthly payment.
Better Mortgage
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Annual Percentage Rate (APR)
Apply online for personalized rates
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Types of loans
Conventional, FHA, VA, jumbo
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Terms
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Minimum credit score
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Minimum down payment
5% for conventional loans, 3.5% for FHA loans, 0% for VA loans, 10.01% for jumbo loan
Pros
- No application fee or underwriting fee
- Preapproval in as little as three minutes
- $100 rate-match guarantee
- 24/7 customer support
Cons
- Doesn’t offer USDA loans
- HELOC requires draw of at least 75% of your home’s value
- No physical branches
Read more: The best lenders for refinancing your mortgage
Consider a home equity line of credit (HELOC) if you need to tap your home’s value with a revolving line of credit for renovations, college tuition or other expenses. HELOCs offer lower interest rates than personal loans and more time to repay than credit cards.
CNBC Select recommends Bank of America, among several lenders, as it doesn’t charge application fees, account fees or closing costs. What’s more, the wide scope of Bank of America’s physical locations can help if you prefer to start this process in-person.
Bank of America HELOC
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Loan types
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Minimum credit score
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Maximum loan-to-value
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HELOC draw amount
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HELOC draw period
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Repayment period
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Fees
No application fees, annual fees or closing costs
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Availability
Bank of America offers HELOCs in all 50 states and Washington, D.C.
Pros
- Available in all 50 states
- Lower credit score requirement
- lends up to $1 million
- No application fees, annual fees or closing costs on HELOC
Cons
- Doesn’t offer home equity loans
- Have to complete closing at a branch
Read more: Best home equity lines of credit (HELOC) lenders
If you have an adjustable-rate mortgage and you’re facing the end of the fixed-rate portion of your term, you should consider refinancing to a fixed-rate term. Doing so will help you ensure your monthly mortgage payment remains stable and will eliminate the risk of a sharp uptick in your rate — which could result in higher costs each month and over the life of the loan.
If you want to refinance to a fixed-rate mortgage as soon as possible but don’t have the extra cash on hand to pay for closing costs, there are mortgage lenders, like Better, that let you wrap your closing costs into the loan so you won’t have to pay anything up front.
If you’re looking to get your refinance done as soon as possible, Rocket Mortgage is a great option.
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At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every financial product review is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of financial products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics.
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Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.
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