How the 2025 Recession Could Affect Your Finances

Today’s blog post summarizes a recent YouTube video I posted on my channel regarding being prepared for a 2025 recession. Unfortunately, we might face tough times. But first, I need to talk a little bit about what happened to me, so you can better understand how to analyze your situation and prepare for the future.

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Those Who Forget the Past…

I know it’s like looking into a crystal ball, trying to figure this stuff out, but it started when a friend of mine, an electrical engineer, once told me that when he’s working on projects, they have something they call “The X Factor.” Basically, what could go wrong will. Murphy’s Law. In my case, as much as I thought I was prepared for a downturn in the economy, things happened beyond my control. Better yet, life happened.

First of all, it all started with the housing market. I was in my 30s back then, and I started researching, asking myself, “Why is everybody getting approved for a loan? This can’t be good. We’ve never gone through this before.” So, I knew it was important to be informed.

Once I figured out what the subprime mortgage market was, I thought, “The housing market is going to crash. I need to get out of this house. I’m going to flip it, make some money, and be debt-free.” I was planning a simultaneous sale and purchase, buying a beautiful townhome a mile or two away. To be in my mid-thirties and debt-free would have been a major game-changer financially.

Then, Hurricanes Katrina and Wilma came in and changed things financially for me overnight and for tens, if not hundreds of thousands of people. Even the person selling his townhome said he had substantial damages, so he couldn’t proceed with the sale. On top of that, the bankruptcy law changed in 2005. I lost half my income overnight. But selling my property seemed like a chance to bounce back, lower my expenses, and be debt-free.

However, insurance companies aren’t in the business of writing checks. By the time I settled my claim, the housing market was already crashing, and I was left with a house that was underwater. I simply walked away from the house.

That’s an example of how you can try to prepare as much as you can, but something can always happen to affect you. Something that you have no control over. So, why am I talking about this now? Well, I’m going to compare the present with what happened in the 2000s, under George W. Bush, when they changed the bankruptcy law with the Bankruptcy Abuse Prevention and Consumer Protection Act, or “BAPCPA.”

Preparing for a 2025 Recession

Now, we’re dealing with the chaos of the Trump tariffs, which I’ve written plenty of articles and posted videos about. You can search for them on my blog or YouTube channel. This includes the trade war with Canada, which continues to escalate with an added twist.

• The Lies Continue with the Trump Tariffs
• No Guarantees that the Trump Tariffs Will Lower Prices

Now, Canadians coming to the US have to register if they’re staying more than 30 days. That never used to happen. Canadians love to spend the springtime in South Florida. I know this because I’m from Miami, and the golf course I used to play at was full of Canadians during the spring, where they’d stay for months.

• You Might Be a Liberal Prepper

There was a time when I was looking to buy a home in Naples, Florida, and relocate there for a slower lifestyle. I still had clients in Miami, so the plan was to downsize my office and open a bigger one in Naples. Again, part of the master plan, right? The “X Factor” changed all that.

Generally, from October 1st to March 1st, Naples became like Miami, full of Canadians who rented for five or six months, playing golf every day, and enjoying themselves. Once, I went to the Lee Trevino golf course in Naples. When I walked into the pro shop, I said, “Wait a minute, what’s going on?” I was traveling back from Orlando, and my wife and I wanted to stop and play a round of golf. The kid working there said, “They left.” I replied, “Today is March 1st.” He said, “Yeah, just like clockwork. They all disappear.”

It’s strange. They don’t stay a day longer. I have neighbors like that, who leave and come back at the same time every year. But that’s the point. Imagine having your home rented out to the same tenants for six months every year. For the other six months, you could do one-month rentals or use it yourself. All that is in jeopardy now. That’s why I keep talking about the snowball effect. Anything can happen that could affect you personally.

A 2025 Recession Will Impact You For Years

If you think, “Well, I don’t have property in Naples, what do I care?” Do you own or work for a business in Naples? If Canadians are boycotting travel to the US, which they might, that’s less revenue coming into Naples during that time of year. Naples depends on snowbirds. It’ll affect golf course revenue, stores, restaurants—everything. It’s a snowball effect, and the effects are long-lasting. It’s not like a 2025 recession starts now and three months later it’s over.

But let’s not focus on one city in the country. It’s not just Naples, it’s everywhere. The reason I mention this is that you have to look around at everything going on and ask, “How is this going to affect me personally? How is this going to affect my bottom line financially?” Then, adapt accordingly. Again, the plan should be long-term. Just ask anyone who has experienced a recession before, and they will confirm that a 2025 recession will carry over for years.

For example, if you’re a landlord in Naples, you should be calling your tenants to confirm their plans. If they’re not coming, you need to post your property on VRBO or Airbnb immediately to make up for the loss of income.

I keep saying chaos creates political instability, which creates financial instability. Politics aside, we care about our pocketbooks, and there’s nothing wrong with that. We work hard for what we have. But you can see how something simple, something you have no control over, could affect you financially and be devastating, like the hurricane was for me.

And now, you see how this could potentially affect Naples and other places Canadians visit. But it’s not just tourism, as the U.S. does buy lumber from Canada, so this could increase housing costs. The list of products affected by the tariffs is endless.

All these little things can affect you financially. Analyze your situation. Look around. Do you have a business that could be hit by a tariff? Even if not, how would this affect you indirectly? What’s that “X Factor”? You won’t be 100% right. Mother Nature beat me last time, so I couldn’t predict that one, but I knew the mortgage foreclosure crisis was coming.

But once you can figure that out, you can reduce your losses and adapt to the situation. Businesses constantly have to adapt, and this is another situation where you’re facing those issues. Even if you don’t own a business, you have to be prepared for a 2025 recession.

For example, if the tariffs increase your household expenses, how can you prepare for that without getting into more debt? Try to look at all the angles. I know, it’s not easy, but it gets easier with time.

This podcast was transcribed from an audio recording. The transcription may contain inaccuracies or errors due to the limitations of transcription software and the quality of the audio. I have made every effort to ensure the accuracy of the transcription, but we cannot guarantee it.

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