Many Americans have been preparing for Trump 2.0 by building a bigger emergency fund to absorb the fallout. Now, with Musk’s DOGE ravaging our federal government and slashing services, shoring up your personal finances is critical. Here’s how.
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Few of us, myself included, anticipated the widespread chaos and potential collapse of government services and financial protections as shadow President Musk and DOGE hackers rampage through agency after agency waging their broligarchy coup of self-enrichment.
A clearer picture is emerging as the dominos of undermining government funding and services begin to fall all across the country. Inflation is rising , the stock market is finally sitting up and taking notice, and the loss of federal jobs and funding threatens red and blue state economies alike. Americans are facing growing fears of compromised personal data, the loss of Medicaid, and increasingly volatile markets that threaten to destabilize a once strong economy in a matter of weeks.
First and foremost, many Americans are beginning to ask some crucial questions: Is my money safe? Is my data safe? Can I trust the U.S. government? As the Consumer Financial Protection Bureau is gutted and Social Security numbers and financial data exposed through system breaches by Musk’s team of hackers embedded at the OPB, the Treasury and Education Department and even the Internal Revenue Service (IRS), the trust citizens once put in the U.S. government now seems ominously uncertain.
While there are some signs the courts are trying to slow the ongoing coup, including news that the NIH federal funding freeze had been lifted, ambiguity remains about whether the Trump regime will comply with court orders. In the meantime, here’s what you can do to prepare for worst-case economic scenarios and to keep your assets safe and your financial freedom intact as fascism in America comes into focus.
What are the leading indicators of financial distress?
Certainly you’ll know soon enough when your personal finances are under stress, but how can you read the tea leaves in the economic vibes at large? Some economic indicators act as red flags that we’re headed for a recession and enable you to shore up your money situation before suffering serious losses.
Economic forecasts, once somewhat optimistic about the financial stakes of another Trump presidency, have turned sour in recent weeks as inflation edges up and consumer confidence plummets.
Keep in mind however that these indexes are not designed to provide warnings of sudden economic collapse, so it’s smart to take a few steps to protect yourself from potential hyperinflation, bank runs, and stock market crashes that are the hallmarks of a failed state. As Musk and his hackers continue to hollow out the government, there is increasing risk the country could approach the stage of collapse where a government is no longer able to provide basic services to its citizens.
Watch the GDP growth rate
The Gross Domestic Product or GDP having negative growth for two quarters or more is a reliable long-term indicator of economic distress. At last measurement in the final quarter of 2024, America’s GDP was posting a healthy, robust rate of growth.
Unemployment rate
Rising unemployment typically signals a slowing economy, but there are some concerns that Musk and DOGE’s access to the Bureau of Labor Statistics (BLS) was intended to lay the groundwork to tamper or alter this data so it may not be a reliable indicator moving forward. As of early February, BLS reports the current national unemployment rate edged down to 4% although this obviously does not account for the nearly 250,000 federal employees the Trump regime threatened with termination in the last few weeks.
Consumer spending
Usually, waning consumer spending and rising anxiety forecast financial trouble ahead. Consumer spending remained strong over the 2024 holiday season but there are signs it could be slowing as panic over tariffs and government cuts set in.
Inflation rate
Higher inflation usually signals a growing economy but it can also be misleading. Sudden spikes in inflation could trigger banks to raise interest rates, which in turn leads to the economy to slow as consumers pull back on spending. Currently, trends and financial experts indicate this is exactly what’s happening.
Price of gold
When the stock market grows volatile, people will often turn to more tangible investments such as real estate and gold. The rising or falling price of gold can be a sign of investor confidence or concern. Gold is currently hitting record highs but has been on an upwards trend for more than a year.
Stock market performance
And last but not least, you can usually see some signs of financial stress in the volatility of the stock market. So far the market seems to be brushing off concerns about tariffs and consumer spending, a bluff that experts warn may backfire in the very near future and lead to an actual crash.
Are there current signs of impending financial doom or economic collapse?
Although rising inflation is causing some consumer anxiety and leading the Federal Reserve to back away from interest rate cuts, the rest of the economic indicators are holding steady. Certainly economic collapse doesn’t seem imminent, although rising prices at the grocery store might make it seem otherwise.
However, there are definitely things happening behind the scenes at the federal level that should cause Americans concern, especially in terms of their financial future. The unprecedented exposure of large swaths of personal financial data by DOGE hackers as well as the dismantling of the Consumer Financial Protection Bureau mean every American should take action to protect themselves against fraud, identity theft, and economic instability.
Steps you can take today to build economic resilience
Financial resilience in the face of uncertainty is a tricky balance that’s equal parts vigilance and minimizing losses. Here’s what you can do in the coming weeks and months to protect yourself, your savings, and your data from the financial risks of a country sliding into fascism.
Keep a close eye on your retirement savings
The market is likely to grow volatile as Trump seesaws back and forth on diplomacy by tariff. Make sure you choose safe investments like bonds and, if you’re close to retirement, consider moving anywhere from five to ten years of income into more easily accessible bank accounts.
Not close to retirement? Tony Steuer, CLU, LA, and CPFFE says to hold steady for now and not panic. “I review the asset allocation of my investments to ensure that they meet my long-term goals,” he says. “Over long periods of time, the stock market provides a steady return. The best recommendation is to monitor the situation and not overreact.
Build a bigger emergency fund
Whatever you have saved, it’s probably not enough. Keep doubling down on expanding that emergency fund to take into account healthcare expenses and rising costs for everything from groceries to utilities and insurance.
“Financial uncertainty is something we are always navigating, especially for those from marginalized communities—whether it’s concerns about employment, healthcare access, or shifts in government benefits,” says Rita-Soledad Fernández Paulino, a money and self-care coach and founder of Wealth Para Todos. “Given the current economic landscape, it’s more important than ever to build a robust emergency fund.”
Paulino says while three to six months worth of expenses is the standard for an emergency fund, she advises families with heightened risk to put away up to a year of expenses in liquid savings.
Invest in tangible assets
One way to insulate yourself from losses is to make sure you’re investing in tangible assets like gold or real estate. When markets crash, these types of assets tend to hold their value. However, in the case of real estate especially, they can be harder to liquidate in an emergency.
This year, I’m putting this advice into action and investing some of our savings into building on our property so we can start a small business to generate additional income that could bolster our retirement plan.
Have a financial fallout plan
Sit down with your family and make a plan for what happens when you lose your job, your student loans or grants, or your healthcare. Account for how you would handle expenses for big ticket items like needing to buy a new car or funding education out-of-pocket.
These are worse-case scenarios but it helps to talk through what options you and your family have so you can prioritize what matters most.
Keep your money close to home
One change I’ve leaned into financially is keeping some of my savings close to home. All of my bank accounts are now at a local credit union with a branch that’s minutes from my home.
If you bank online, you may want to consider keeping a significant amount of savings in cash at home in a fireproof safe.
Tighten your budgeting belt
All of this savings requires spending less or making more or both. So if you haven’t yet, sit down with your budget and carve out some ways you can immediately generate income either through trimming expenses or taking on a side gig.
Steuer says a good place to start is to review all your resources and see if you have enough liquid cash to cover expenses and for how long. “This may be a good time to reduce expenses at least for the short term to see what actually happens,” he explains. “And to explore potential side hustles to earn extra money.”
Watch your credit closely
Regardless of whether or not your data is in government hands, we live in an era of constant breaches and system exposures where the risk of identity theft and fraud is always present.
Fernández Paulino recommends checking your credit report for free at www.annualcreditreport.com and freezing your credit at all three credit reporting bureaus (Experian, TransUnion, Equifax). Additionally she advises turning on multi-factor authentication for all your accounts, using a password manager to generate strong, unique passwords, and never clicking on links in emails or texts to avoid phishing scams.
America’s financial future remains uncertain as modern robber barons like Elon Musk continue to chop up your government and sell it for parts. One thing that’s clear is the current regime does not have your best interests, financial or otherwise, at heart. So taking steps to insulate yourself and your family’s finances from the worst of the fallout is the smartest money move you can make.