Financial experts may still be debating whether we’re in a recession—technically defined as at least two consecutive quarters of declining gross domestic product—but don’t tell that to Brooke Fairman, a vice president at the Bank of America in Providence, RI, and mother of 6-year-old Kinzie. For Brooke, as for many moms trying to keep their kids in milk and eggs, their cars filled with gas and their homes heated, there’s no debate. “Are you kidding? Of course we’re in a recession,” she says. A single mom who adopted Kinzie from Russia in 2002, Brooke canceled an annual summer road trip to Canada because of high gas prices. And, she adds, “I’ve definitely changed my shopping habits. I’m looking for bargains at Stop & Shop instead of buying everything at Whole Foods.” Brooke is also worried about her heating bills this winter. “My natural gas bill used to be about $250 a month. This winter, I expect the bill to be $500 a month—or more.” With unemployment rates, food prices and energy costs all on the rise, it certainly looks like a recession, says Julianne Malveaux, an economist and president of Bennett College for Women in Greensboro, NC. In fact, the only thing she sees dropping is consumer confidence, which she notes is “at its lowest point since the 1980s.” When will things pick up? The average length of a recession in the United States is 11 months, says Ryan Sweet, senior economist at Moody’s Economy.com, an economic consulting firm based in West Chester, PA, who also notes that “no two recessions are alike.” To cope with this cloud of uncertainty and keep stress in check, we asked experts for some easy-to-follow strategies in an economic downturn.

Keep Your Job

Take any opportunities at work for stretch assignments, which help build new skills, and to make yourself as useful to your employer as possible, experts say. You want to keep the reasons you’re indispensable top-of-mind if layoffs become necessary. “Now is the time to make yourself as valuable as you can,” advises Joseph Matoney, who runs an accounting and financial planning practice in Wakefield, RI. It’s also a good idea to update your resumé and keep your eye on job listings in case you do need to look for a new job, Matoney says.

Start a Rainy Day Fund

Saving cash in an emergency fund is always important, but it’s especially critical during a recession, when your job may be less secure and new work harder to find. Financial pros vary on how big your safety net should be, but Evan Branfman, an associate financial advisor with Kuttin & Associates, a financial advisory practice of Ameriprise Financial Services in Melville, NY, recommends putting aside enough to cover six to 12 months of expenses. “If you think your job may be in jeopardy, start stepping up your saving as much as possible,” suggests Branfman.

Reduce High-Interest Debt

Reducing your credit card debt may not feel like a priority these days, but consider this: Since interest rates tend to go down during recessionary periods, your debts will cost you less and your debt repayment dollars will go further. That means it’s a prime time to pay down credit card debt. “Make sure your debts are ‘good debts,’ that is, mortgages or home equity loans, anything that’s tax deductible,” Branfman advises. If you have credit card debt, consider paying it off with a home equity line of credit, which is likely to have a lower interest rate and will save you tax dollars. Set up a home equity line of credit or a fixed-rate home equity loan so that if you lose your job and need emergency cash, you can get money quickly and without racking up credit card charges.

Stick to a Realistic Budget

This is an ideal time to review your budget and cut back on unnecessary spending. “Sit down with a sharp pencil and a piece of paper and figure out where your money goes,” says Joanne Hamilton, an accredited financial counselor with the University of Maryland Cooperative Extension in Carroll County, MD. “Most people have no clue.” Determining where you can trim expenses may even free up some money to pay for heating this winter. “Everyone’s going to be hurting when the fuel bills start coming in,” says Hamilton, who suggests reviewing all your bills to see which you can cut back on—or cut out altogether. “Are you spending too much on cable or on dinners out and entertaining?” she asks. “Can you cut your gym membership and jog instead? Can you take a thermos to work instead of stopping at Starbucks?” And when it comes to splurges on your children, it’s a good time to distinguish between wants and needs, says Malveaux. “Do they really need all those new toys for the holidays?” she adds. “Impulse buying is nice and can make you feel good, but it is not a good idea when you have less disposable income.”

Save for the Long Term

Continue to fund your retirement accounts—and don’t even think about raiding them for extra cash, our experts say. “You should be saving for retirement even in tight times,” says Branfman. Above all, avoid panic selling, Matoney emphasizes. Instead, consider rebalancing your portfolio. A recession is a good time to reevaluate your risk tolerance, Branfman says. “It’s easy to overestimate your risk tolerance in a bull market. Now is a good time to see if your investment strategy is really in line with your true risk tolerance.”

A Teachable Moment

A recession is a great time to help your children gain financial literacy. Try to enjoy the small ways you can cut back, such as going to the library for free family videos. But don’t feel you need to hide the fact that you’re cutting back from your kids. “Let your children track the rising price of their favorite snack at the grocery store,” suggests Julianne Malveaux, an economist and president of Bennett College for Women. “Make it into a game.” She believes that while you don’t want your children to worry about whether you can pay the mortgage, they should know what things cost. Helping your children understand how far money can and can’t stretch is key, agrees Joanne Hamilton, an accredited financial counselor with the University of Maryland Cooperative Extension. “Don’t say, ‘We can’t afford that,’” she advises. “Say, ‘This is how much money we have. Help me figure out how to spend it.’” Offer kids choices that teach the value of money. “Tell them they can either have ice cream out once,” she says, “or they can eat ice cream at home three times.”

TIP

Take advantage of lower interest rates to pay down credit card debt because your dollars will go further.