What The State Of Women's Study Says About An Impending Recession

There is no doubt that we are facing an economic downturn. And while it is impossible to predict the exact nature and extent of the recession, there are some things we can do to prepare ourselves financially. One of the most important things is to change our behavior with money.

Many of us spend recklessly when times are good and tighten our belts when times are tough. However, this cycle can exacerbate the effects of a recession. Instead, we should maintain a consistent level of spending throughout the ups and downs of the economy.

It is also helpful to focus on building up our savings. Saving money will give us a cushion to fall back on if we experience job loss or other financial setbacks. And, if we can weather the storm without dipping into our savings, we will be in even better shape when the economy eventually recovers.

Taking these steps may not prevent a recession, but they can help us weather the storm and come out stronger on the other side.

Her Money and the Alliance for Lifetime Income's State of Women released the latest chapter of their State of Women 2022 study, which found that over two-thirds (68 percent) of women see a U.S. recession ahead. However, in these uncertain times, women are doubling down to secure their financial futures.

Key findings of the study

The study found that women are taking action to protect themselves financially. For example, women have said the top trade-off they are making now is limiting the purchase of luxury goods. Millennials are more likely to make tradeoffs and save their money.

“Women have told us time and time again that they prioritize saving and have peace of mind when they know they have enough protected income to last throughout retirement,” says Jean Statler, CEO of the Alliance for Lifetime Income.

What business owners need to know

First and foremost, it is important to remember that recessions don't happen overnight—they typically take months or even years to develop. So, while preparing for a potential downturn is essential, there's no need to panic.

There are steps you can take now to help weather a potential recession—just like your customers are doing on a personal level. For example, if revenue drops during tough economic times, you can create a cash reserve to tide your business over. You can also take steps to reduce costs, such as negotiating better rates with suppliers or trimming nonessential expenses from your budget.

Women across America are preparing for a recession by:

1. Saving money

It was found that 42 percent of women say they have more savings than they did last year. Women have started stockpiling supplies in case of emergency, and others say they are cooking more meals at home to save money.

2. Reducing expenses

Women have reduced spending on nonessentials like dining out, entertainment, and vacations. Many have increased their use of coupons, while others have been looking for better deals on everyday purchases.

3. Paying down debt

Women say they work hard to pay off debt like credit cards, student loans, and car payments. This includes women making extra monthly payments and others who have consolidated their debts into one lower-interest payment.

The bottom line is that the State of Women's study provides valuable insights into how women feel about the economy—and what they are doing to prepare for a potential recession. As a business owner, you should use this information to inform your decision-making and ensure that your business is positioned for success no matter what the future holds.