Gross domestic product, adjusted for inflation, fell 0.2% in the second quarter of this year. According to the Commerce Department, that’s the equivalent of a 0.9% annual rate of decline.
The potential for a recession has been a focus of all media outlets—and as of today, it is something that is still yet to be determined. I’m sure it’s been on your mind—how couldn’t it be? Just the word “recession” itself can conjure up fear, sending cortisol pulsing through our bodies.
I am certainly not immune. As an entrepreneur whose services are often considered “non-essential,” it’s quite easy for me to get caught up in the swirl of worry and concern. But I always stop myself—because I know the following:
Recessions are a part of life. I’ve lived through the financial crisis of 2009. In fact, that’s when I actually started my business, in the midst of a massive recession. I also weathered the pandemic-induced economic turndown in 2020. My business did not crumble.
The media is focused on getting views and clicks, meaning headlines are geared towards playing on humans’ worst fears. I have nine years of article-writing experience and headlines are one of the most important parts of getting your article’s visibility. The more dramatic, the better. Most headlines are taking the worst-case scenario and making it seem like a possibility. Like these:
- Why tech could struggle to make back this year’s losses anytime soon
- U.S. economy shrinks for a second quarter, fueling recession fears
- U.S. yield curve flashing more warning signs of recession risks ahead
- U.S. plunges into recession as inflation hammers world’s biggest economy
Fear is not helpful when it comes to doing your best work and maintaining your well-being. It causes cortisol and adrenaline to be released and can cloud your thinking. It puts you in fight or flight, which means your decision-making skills and ability to focus will be impaired. Fear is meant to keep you safe, but when it’s not well-managed it will prevent you from being your best.
3 Truths to Help Keep You Grounded
Knowing all of the above allows me to get and stay grounded. Because here’s the truth:
This (potential) recession is yet another change, and change is becoming more and more constant. Our brains resist change in order to be more energy efficient. Therefore, any change will feel hard. But if you can get into your rational mind and recognize it as change, you can make a plan for it.
Recessions will encourage different experiences and ideas. If you’re an entrepreneur, rethink your services and offerings so you can better meet your clients where they’re at. If you’re working in an organization, reprioritize your work and make sure everything you’re doing is important and relevant.
You may have to cut back on your spending. This article talks about how five different families are cutting back to manage inflation costs. Our society tells us more is always better, but cutting back doesn’t have to be painful. It’s about doing things differently. For example, one family chose to camp out close to home for their family vacation instead of driving far away. Just like during the pandemic, cutting back can remind you of the truth of happiness: It’s about connection to others, experiences, and how you feel—not about what you buy or how much you spend.
How I Deal with a Recession
With two big recessions under my belt, I know that their effects are highly unpredictable, so assuming the worst isn’t helpful. As a way to pull back the curtain and share my own experience, with this potential recession I am doing a few things:
- I am noticing when I get worried or feel fear and immediately pause and dismantle it. I know that I inherited a scarcity mindset from my family, which means I’m programmed to believe there will never be enough money. In times like these, I double down on rewiring that mindset. I look at my finances, get clear on my budgets—including determining which expenses are essential and which aren’t—and make a financial plan based on three possible future scenarios.
How you manage your money is directly linked to your psychology and the programming you receive about money from your family of origin. Knowing what your relationship is to abundance—do you believe there will always be enough or do you believe there never will be enough?—is a critical step towards finding peace within any economic chaos. For me, savings is part of finding that peace. For those living paycheck to paycheck, it may not be possible, but what is possible for everyone is identifying your specific relationship to money, rewiring it if needed, and identifying new behavior habits that allow you to find peace and joy in the midst of any financial triggers.
- I think about what I could do business-wise if I have fewer clients or less business overall. While my plate is full now, that could change. The reality of a recession is you never know what will happen. I’ve had business go up and go down as a result of economic downturns. And for me, when it goes down, that means more time to think and create.
- I help my clients get clear on what’s real about their fear and what isn’t. For example, one of my CEO clients is viewing the potential recession as a huge opportunity and is excited about what is possible. I have another client working in a large organization who will experience no risk with her job; nonetheless, the change is making her “think” she could get fired, and as a result, she’s experiencing an increase in anxiety. She’s actually creating anxiety by believing something that isn’t actually true.
- I double down on meditation and wellness. The best way to dismantle fear and anxiety is to move and get silent. I do these things regularly but even more so if I find myself getting anxious. I guarantee listening to one of my playlists—like my Release Fear Playlist—will create an immediate shift toward joy and peace.
Bottom line: We can’t control whether or not there will be a recession. But we can control the content and media we consume and how we process it, the way we save and spend the money we do have, and how we take care of ourselves. I hope this article helps you face the uncertain economic times ahead. We’re in this together.