How to Control Your Finances During Uncertain Times

The past several years have been a time of great uncertainty in the world. Disease, wars, economic turmoil, domestic upheaval, the list goes on. A question a great many people ask is what they should be doing to prepare their finances to weather the storm(s). Here are some truths that will ensure you're doing what you can to "batten down the hatches" and ride through the turmoil.

Control the Controllables

Rule number one is to control the controllables. We mere mortals cannot control what happens in the world, so the key is to make sure you're doing the things you can do to prepare. This is one reason why working with a financial planner is so helpful, we work with clients to identify priorities and develop optimal solutions to mitigate risks.

Here are the controllables:

  • Income
  • Debt
  • Portfolio allocation
  • Spending
  • Savings rate

Let's take a closer look at each one.

Income

Your income is the engine of your financial life, and there are more ways to influence it than many people realize. You may not be able to control whether your employer offers a raise this year, but you can control whether you position yourself for one. That might mean acquiring a new certification, taking on additional responsibilities, or simply having the conversation.

Diversifying your income is another powerful lever. A side business, freelance work, or a rental property can create a second stream of revenue that softens the blow if your primary source is disrupted. According to the Bankrate 2026 Annual Emergency Savings Report, people who increased their emergency savings in 2025 were more likely to report increased household earnings, and those who saw savings decline were four times more likely to have experienced reduced earnings (Bankrate).

The point is not that everyone needs a second job. It is that income growth, however you achieve it, is one of the most effective ways to build resilience.

Debt

U.S. household debt reached a record $18.8 trillion in the fourth quarter of 2025, up $4.6 trillion since the end of 2019, according to the Federal Reserve Bank of New York (Yahoo Finance). Credit card balances alone hit $1.3 trillion, the highest level since tracking began in 1999.

Debt is a controllable, but only if you have a plan. Some strategies to consider:

  • Prioritize high-interest debt first. Credit card interest rates remain near historic highs. Paying down a balance at 24% APR is one of the best "returns" you can earn.
  • Refinance where it makes sense. If rates have dropped since you took out a mortgage or auto loan, refinancing could lower your monthly payment.
  • Avoid new debt for depreciating assets. Financing a car, furniture, or a vacation ties up future income for things that lose value.
  • Build a debt payoff plan and stick to it. Whether you use the avalanche method (highest interest first) or the snowball method (smallest balance first), consistency matters more than the approach.

Portfolio Allocation

Market volatility is a feature of investing, not a bug. The right portfolio allocation is one that matches your time horizon, risk tolerance, and financial goals, not one that reacts to the day's headlines.

During uncertain times, the temptation to move to cash is strong. But history is clear: missing the market's best days can dramatically reduce long-term returns. A well-allocated portfolio is designed to weather downturns and participate in recoveries. That means holding a mix of assets, stocks, bonds, and other instruments, that aligns with when you actually need the money.

Rebalancing is the disciplined way to keep your allocation on track. When one asset class grows beyond its target, you trim it and add to the underweighted class. This forces you to buy low and sell high, the opposite of what fear and greed push you to do.

Spending

Spending is the controllable that most directly affects your monthly cash flow. Consumer prices were 26% higher in December 2025 than in December 2019, according to Bureau of Labor Statistics CPI data cited by Bankrate (Bankrate). Inflation has cooled from its peak, but prices remain elevated, and 54% of Americans say they are saving less because of rising prices.

The goal is not to eliminate spending; it is to spend intentionally. Some practical steps:

    • Track your spending for a month or two. You cannot change what you do not measure.
    • Separate needs from wants. Housing, food, transportation, and healthcare are needs. Streaming subscriptions, dining out, and impulse purchases are wants, and they add up faster than most people realize.
    • Build in a buffer. If your income is variable or you are worried about job security, trimming discretionary spending now gives you flexibility later.

    Savings Rate

    Your savings rate is the percentage of your income that you keep rather than spend. It is the single most important number in personal finance, more important than your income, your investment returns, or your tax bracket.

    The U.S. personal saving rate stood at just 3.0% in July 2026, according to the Federal Reserve Economic Data (FRED) published by the St. Louis Fed (FRED). That is well below the historical average and a clear sign that many households are stretched thin.

    A strong savings rate does three things:

    • It builds your emergency fund. Only 46% of Americans have enough savings to cover three months of expenses, and 24% have no emergency savings at all (Bankrate). Aim for three to six months of essential expenses in a liquid, accessible account.
    • It funds your future. Retirement accounts, education savings, and investment accounts all depend on a consistent savings habit.
    • It creates options. Cash in the bank is not just money; it is the freedom to make decisions on your own timeline rather than out of necessity.

    The Value of a Financial Planner

    None of this is easy to do alone. The CFP Board's Financial Planning Longitudinal Study found that Americans who work with CFP® professionals achieve significantly better financial outcomes than those who do not. The numbers tell a compelling story:

    • 78% of clients working with CFP® professionals maintain a three-month emergency fund, compared to 53% of non-advised individuals (CFP Board)
    • Only 8% of CFP® professional clients experience money anxiety
    • 49% report reduced financial anxiety through their advisor relationship
    • 51% of CFP® professional clients report "living comfortably"

    A financial planner helps you identify what you can control, build a plan around it, and most importantly, stick with that plan when the world feels unpredictable.

    The Bottom Line

    Uncertainty is not going away. There will always be events beyond our control, in the markets, in the economy, and in the world at large. But you can control your income, your debt, your portfolio allocation, your spending, and your savings rate. Focus your energy there, and you will be better prepared for whatever comes next.

    If you would like help building a plan for uncertain times, we are here to help. Contact Afton Advisors to schedule a conversation.