Prices for gas, food and rent are soaring. The US economy has shrunk for two straight quarters, which technically qualifies as a recession (apparently not in Federal Reserve chair Jerome Powell's books though), while the Bank of England all but conceded it was inevitable this year. Despite that, both institutions in their latest policy moves hiked interest rates.

The Federal Reserve has raised interest rates to the highest level since 2018. The BoE's rate reduction was the steepest in 27 years. Economists are divided over whether a recession is looming. What's clear is that economic uncertainty isn't going away anytime soon. And chances are a recession will visit upon the US, the UK, and most other countries around the world.

In countries like Bangladesh, climbing the ladder of development, used to fast growth, you don't really need a recession as such - a substantive slowdown in the economy can wallop you just as badly. But there are steps you can take now to be ready for whatever is ahead.

Yiming Ma, an assistant professor at Columbia University, says it's not a question of if but when a recession will happen. People should prepare but not panic, she told AP.

"Historically the economy has always been going up and down," said Ma. "It's something that just happens, it's a bit like catching a cold."

But, she notes, some people's immune systems are better able to recover than others. It's the same with finances. If you think a recession could destabilise yours, here are 5 primary steps you can take to prepare.

Know Your Expenses and Make A Budget

Knowing how much you spend every month is key. Ma recommends sitting down and writing how much you spend day-to-day. This will help you see what's coming in, what's going out, and which unnecessary expenses you might be able to cut.

"By understanding what money you are getting and what you are spending, you may be able to make changes to help you through tough times," advises the Federal Deposit Insurance Corporation's Money Smart, a financial education program.

Budgets often reveal expenses that can be eliminated entirely or impulsive spending that can be avoided with planning.

For guidance creating a budget, free courses such as " Creating a budget (and sticking to it) " by CT Dollars and Sense, a partnership of Connecticut state agencies, and Nerd Wallet's Budget Calculator can be good places to start.

Save As You Can

The more non-essential expenses you can cut, the more you can save.

It's not possible for everyone, but Gene Natali, cofounder of Troutwood, an app that helps people create financial plans, says it's ideal to budget to save enough to cover basic necessities for three to six months.

Programs such as America Saves, a non-profit campaign by the Consumer Federation of America, can help create a roadmap.

And if you do have a savings account, it's important to check whether your bank gives you a good interest rate and shop around if it doesn't, Ma said.

Her advice is to keep an eye on the monthly fees or service charges that might eat into your savings. But don't limit your options. Online banks sometimes offer better rates than traditional ones.

Consolidate Your Loans, and Don't Take Any More

As interest rates rise, experts recommend that you consolidate your loans to have just one fixed-rate loan and, if you can, pay down as much of your debt as possible.

"Job security tends to be worse when a recession comes, it's not a great time to accumulate debt," said Ma.

But paying off your existing debt is easier said than done. The Federal Trade Commission's Consumer Advice guide for Getting Out of Debt can help you make a plan.

With interest rates high, it's also not a great time to take out new loans for big expenses like cars, though experts do recommend that if you need durable goods such as vacuum cleaners, stoves or dishwashers, you buy them as soon as possible to avoid future price increases.

Visit Second-Hand Stores and Yard Sales

Allen Galeon, an in-home caregiver in California, has been affected for months by the rising prices of household staples like groceries, paper towels, and gas for his commute.

His son's favorite Hi-C orange juice, which was $1.99 for a six-pack, is now $2.50.

Since the start of the pandemic, when Galeon cut down from caring for multiple families to a single client to reduce his health risks, his household has dealt with financial instability.

One choice he's made is to buy items like clothes or electronics second-hand whenever possible, whether from Goodwill, pawn shops, or Craigslist. And Craigslist allows you to search by area, to cut down on driving - which means less gas and inconvenience.

Negotiate Your Monthly Bills

Since the pandemic, many companies have updated their relief policies and have become more flexible with users, according to Kia McCallister-Young, director of America Saves.

Calling providers of monthly services to negotiate bills - whether it's utilities, phone service, cable, internet, or auto insurance - can lead to meaningful savings, said McCallister-Young. Individuals can ask for the best rate, any available discounts, rebates, or coupons that can lead to a lowered monthly fee. If a provider is competitive with other companies, there's an even better chance of getting a discount, she added.

"If you tell them, 'I'm thinking of changing' or that you're shopping around, that helps - if they know you're considering leaving, they'll give you the best rate, and the goal right now is to find as much cashflow as possible," she said.

Additional inputs from AP

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