Financial Health
August 4, 2022

What to expect when you’re expecting a recession

Watch as Wells Fargo experts discuss what’s happening in the economy, what this may mean for your portfolio, and how to stay focused on your financial goals.

A man and woman look at a laptop screen.

Where will the second half of 2022, and even 2023, take us? Wells Fargo Investment Institute, or WFII, believes the economic cycle will run faster, interest rates will rise further, and the economy and capital markets will remain fragile in the months ahead as we likely head toward a moderate recession. WFII discusses this in their 2022 Midyear Outlook report. Uncertain about how to respond or what actions to take next? Darrell Cronk, chief investment officer for Wells Fargo Wealth & Investment Management, or WIM, and Michael Liersch, head of Wealth & Investment Management’s Advice and Planning, unpack what this forecast means for both your investments and your wallet.

Prepare, don’t panic

If you feel anxious just hearing the word “recession,” keep in mind that recessions are a natural part of every economic cycle. Cronk and Liersch discuss the hallmarks of a recession, how long and deep this moderate one may be, and what Federal Reserve actions may affect the job market and interest rates.

Focus on thoughtful decision making

When you hear about a recession, you might feel the need to take action in the moment, like flipping a light switch. See why Liersch and Cronk recommend a “dimmer switch” approach for equity portfolios and more, and talking to a professional advisor to assess your needs vs. wants.

Take stock of your priorities and options

Even if you don’t have a big investment portfolio, now is an opportunity to reflect on the quality of your investments and make sure you’re making the right decisions, financially and psychologically. Cronk and Liersch weigh in on the Great Resignation, how much cash you should have on hand, and the risk of trying to time the markets.

Explore insights as you prepare

For help determining what to do with your portfolio while facing the unknowns of the remainder of this year and beyond, download “2022 Midyear Outlook: Faster, Further, and Fragile.” You’ll find:

  • Forecasts for year-end 2022 and 2023
  • Sectors that may offer the greatest opportunity in the coming months
  • Where commodity prices may be going
  • Top five portfolio ideas for the second half of the year
Tune in to the About Money podcast for more everyday strategies. Michael Liersch, head of WIM's Wells Fargo Advice and Planning, helps listeners have productive conversations about money.

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Wells Fargo Investment Institute, Inc. is a registered investment adviser and wholly-owned subsidiary of Wells Fargo Bank, N.A., a bank affiliate of Wells Fargo & Company.