A Recession is Coming: What Should You Do?

Is a recession just around the corner—or are we already in one without realizing it? Mike and Vero tackle the headlines, decode the signals, and most importantly, share what investors should actually do if they’re worried. From yield curves to consumer sentiment, corporate earnings to employment data, this episode provides a rational, dividend-growth-minded framework to prepare for the next downturn—without panic.

Whether you’re in retirement or still building your portfolio, this one’s for anyone wondering: “Should I make changes now—or stay the course?”

You’ll Learn

Not All Downturns Are Created Equal

Mike starts by clarifying the difference between a market correction, a bear market, and a full-blown recession—and why understanding each helps investors react more rationally. It’s easy to panic when headlines scream “crash,” but perspective is everything.

A correction is a normal part of investing (10% drop) and often forgotten within months.
A bear market (20% drop) often feels worse, but doesn’t always last long or lead to recessions.
Recessions are economic events, not market ones—and stock markets typically recover before they’re officially declared.

Understanding these distinctions keeps you grounded when others are panicking.

What Economic Signals Are Saying Right Now

Recession fears have been swirling since 2022, but the data remains mixed. Mike and Vero walk through what investors should look at—and why it’s so hard to time these events. Economic signals often lag, while markets look ahead.

Yield curves are still positive (barely), not inverted.
Unemployment is relatively stable in both Canada and the U.S., though slightly softening.
Corporate earnings are slowing but not collapsing, with results varying by sector.
Consumer spending and sentiment are weakening—but not disastrous, especially when compared to past recessions.

The economy isn’t booming, but it’s not clearly in recession either—making this a tricky phase to navigate.

What Should You Do If a Recession Might Be Coming?

Rather than trying to time the market, Mike suggests practical ways to prepare depending on your phase of life. You don’t need to overhaul your portfolio—but you do need to be intentional.

If you’re retired or nearing retirement:

Clean up your portfolio and trim your winners while markets are strong.
Create a solid cash reserve to avoid selling during a downturn.
Review your sector allocation—tech exposure may be bloated after years of growth.
Run a worst-case scenario in your financial plan and rebalance if needed.

If you’re in growth mode:

Don’t get overconfident—volatility and corrections are part of the game.
Know what you own and why; don’t rely on “brand names” or history alone.
Avoid guesswork or hot tips—have a clear investment thesis for every stock.
Don’t sit on the sidelines too long—“dry powder” may never find its moment.

The key is preparation, not prediction.

What Really Matters: Your Conviction and Your Plan

Trying to outsmart the next downturn usually fails. Instead, Mike encourages listeners to build a strategy that fits their goals and risk tolerance—and stick with it. Strategy matters more than timing, and consistency is more powerful than cleverness.

Mike’s message: You don’t need to fear a recession—you just need to be ready for one. And the time to prepare is before the market moves.

Stock Checklist: Review Your Portfolio with Purpose

Make confident decisions—fast.
Use the free DSR Stock Checklist to assess whether your holdings are built to survive market storms and thrive long-term.

This one-page tool is designed to help you tune out the noise and focus on what matters most: solid, growing companies. With clear yes-or-no questions, you’ll quickly spot strengths, weaknesses, and which stocks deserve a second look.