Here's the 411 on How to Prepare for a Recession as a Couple, According to Financial Experts

Whether you're moving in together, saving for a wedding and honeymoon, buying a home, planning to grow your family or just dealing with your daily expenses, it's important to talk about money and make financial decisions with your partner. In fact, a 2024 Fidelity Investments study found that 45% of couples fight about money, 25% say money is their top relationship obstacle and 27% say they are frustrated by their partner's spending habits. Being on the same page about financial goals, values and plans is even more important when you're dealing with financial stressors like a recession. While economists say the country isn't in a recession yet, it's hard to avoid the warning signs every time you read the news or see prices increase because of tariffs and inflation. Real talk: A recession will affect most couples–dating, engaged and married. This means couples should consider how to prepare for a recession.

Recession planning is just a minor component of what couples really should be focusing on, argues Ramit Sethi, author of Money for Couples. "If 'recession' is at the top of your topic list, you've probably taken a wrong turn somewhere. I'm not kidding," he says. "You shouldn't be having your first, second or even third topic be about a recession. If you have a solid financial plan, then a recession is already built into it." Below, we tapped financial experts like Sethi, Tori Dunlap of Her First 100K and Courtney Alev, a consumer financial advocate at Intuit Credit Karma to share their rules for how couples should be saving for a recession and generally approaching financial discussions. Oh, and in case you need a refresher on recessions, we've got you covered.

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In this article:

• What is a Recession?
• What Causes a Recession?
• How to Prepare for a Recession

What is a Recession?

The National Bureau of Economic Research (NBER) is responsible for keeping a month-by-month chronology of business cycles in the US and determining whether it's a peak or trough month, with a peak being a significant increase in economic activity and a trough being a significant decrease. The period between a trough and a peak is an expansion and the period between a peak and a trough is a recession. Okay, so what is the definition of a recession? NBER defines a recession as, "a significant decline in economic activity that is spread across the economy and lasts more than a few months." As Alev explains, a recession can have a sizable impact on the stock market, consumer spending, interest rates, employment and, yes, your wallet.

What Causes a Recession?

To determine whether the economy is at a peak or trough, NBER looks at data including real personal income minus transfers, real consumer spending, employment numbers and industrial production. (Psst: In this case, "real" means adjusted for inflation.) If these numbers are high for a few months, they are likely to declare it an expansion. If they're low for a few months, they are likely to call it a recession.

While multiple factors can lead to a recession, according to Fidelity, there are three most frequent causes of a recession. The first is an abrupt crisis like a war, financial collapse or global emergency like the COVID pandemic. Sorry to burst your bubble, but the second is when an economic bubble bursts like the stock market in the 1920s, dot-coms in the 1990s and housing in the 2000s. Finally, a spike in economic growth can lead to increased supply and demand, product costs, interest rates and inflation. This can cause hiring freezes or layoffs and decreased consumer spending which, over time, may result in a recession.

How to Prepare for a Recession

Now that you have the low-down on recessions, you're probably wondering how to plan for a recession and make other financial plans with your partner. Here are some expert-recommended rules.

1. Evaluate your money habits

Alev suggests starting by examining your spending and saving habits. "As a couple, start by taking stock of what you must spend each month on essentials, such as rent, groceries, gas and utilities, as well as any debt payments. Once you know how much you're spending on necessities, it'll be easier to see what you can regularly dedicate to savings each month and anything left over can go towards your 'wants'–unnecessary purchases that make you happy, such as restaurant meals and travel," she says. (Don't worry your weekly date night is safe, even if you have at-home movie nights or homemade dinner dates.)

Before spending money on nice-to-haves, she says the first priority should be paying down any debts like credit card payments, mortgages and student loans. If you're contemplating buying a "want" item, she suggests making it a rule that you won't use your credit card for anything that you can't pay off in full each month.

2. Set a standing money date

Speaking of dates, add a money date to your calendar. At a bare minimum, couples should address budgets and spending decisions once a week, but there is a way to be even more intentional about joint finances. Communicating is key to building a healthier outlook in your relationship, which is why experts have long promoted the concept of money dates.

This is a time to discuss everything from debt to investment tactics. You may also want to explore backup plans in the event either of you get laid off during a recession. "If people come to me, they go, 'What do I do about a recession?' It's freaking out. It's frenzied. It's not how you proactively get in control of your money," Sethi says. This is your chance to be proactive. You can't control whether there is a recession, but you can control your own money moves like putting more money in your savings account. (Bonus points if it's a high-yield savings account.)

3. Accumulate an emergency fund

In a consumption-first culture where spending is encouraged in pursuit of new and trendy products, putting your hard-earned money into a savings account may lack the same appeal as, say, a new tech gadget. But an emergency fund, AKA a separate savings account that you only dip into in case of an emergency, will be appealing if you need to use it. Instead of putting an unexpected expense like an expensive medical bill or home repair on your credit card and owing interest if you can't pay your credit card statement on time, you can draw from your emergency fund. It will also come in handy if, unfortunately, you or your partner lose your job.

This is where having a clear picture of your monthly expenses comes into play. Alev recommends having an emergency fund that can cover 3 to 6 months of expenses. Again, some may look at those funds and want to purchase something fun, but the emergency fund is best held and not spent.

4. Automate

Contrary to popular belief, there is one area where you don't have to spend an exorbitant amount of time. "In terms of saving, automate everything you can," says Dunlap, who wrote the New York Times bestseller Financial Feminist. "You can set up an automatic transfer from your checking account into your savings account for X amount a month or X percentage of your paycheck," she says. "On autopilot, you don't have to think about it. It's happening without you having to actively do it."

Along with an emergency fund, couples can automate saving for a goal like a wedding, honeymoon, down payment or retirement. "Too many people wait until the end of the month to start saving and then they suddenly don't have any money to save," Dunlap says. "[Automation] is doing it first."

5. Invest

If you can, about 10% of your take-home pay should be invested. "One of the biggest mistakes people make with their money is they think that managing money means paying off their credit cards every month on time… That's like breathing oxygen. I'm not successful because I breathe. That's what everybody does. Real wealth is created through investing." Instead of focusing on restricting your latte budget, perhaps divert that attention to investments. "One of the key numbers you should pay attention to—way more than how much you spend on coffee—is what percentage of your income are you investing?" Sethi says. "That matters more than all the coffees you'll ever buy combined in your whole life."

6. Spend consciously

Couples with joint accounts or shared expenses should evaluate their fixed costs like rent, mortgage and car payments. "All the fixed costs that you incur that are stable every month should be less than 60% of your take-home pay," Sethi says, noting that ideally it would be between 50% and 60%. "This is where people get in trouble: they spend too much on housing or they spend too much on their car and suddenly they're fighting about, you know, dessert at the Cheesecake Factory. It's not the dessert that's causing the fight. It's that you spend too much on your car and you simply have nothing left to spend."

Along with savings and investment decisions, there is another category couples will appreciate. It's what Sethi calls "me money." He says you can use 20% to 35% of your take-home pay for "guilt-free spending" on wants.

7. Refine your values

Part of the awakening is truly grasping the areas where you choose to allocate money. "Conscious spending is being intentional about what you spend, and spending extravagantly on the things you love," explains Sethi. "Your conscious spending will be radically different than mine and that's OK… I love nice clothes, I love traveling well and I have a few other things. The more you are truly conscious and you turn that dial up, the more your rich life will become unique to you—and even bewildering to others. That's how it should be."

One exercise for sourcing what you love is inherently bringing it back to your values. Perhaps you'll want to complete this exercise separately, but couples should inevitably have the 'values' conversation. Often when Sethi poses the question about personal values, couples respond with answers like eating out, travel, then health or wellness. "I go, 'Cool and that's great. What do you love about it?'" he says. "What's the thing you love to spend money on? It's critical to be able to define what a rich life is. Part of a rich life is actually spending extravagantly on the things we love—as long as we cut costs mercilessly on the things we don't."

8. Build your dream lives

Returning to the first principle, couples should do their best to lead with their dreams and values. Finances are no exception. "If you're a couple, use money as a tool to build the life you want," says Dunlap. "This is the perfect question to ask in that money date that you're going to have every month: 'How do we use money as a tool to build the life that we want?'" she says. "Rather than seeing money as the thing that prevents you from doing it or as a source of stress, concern or conflict, it is simply the tool that you're using to afford all of the other beautiful things in life."

In the event that a recession arrives, resulting in a financially challenging situation, you'll still be able to communicate through the storm. Simply by following these rules and creating a routine around money, you'll be better prepared for uncertainty—and far more resilient as a pair.

—With additional reporting by Elana Lyn Gross.

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