18 Expert Strategies For Promoting Economic Agility

The global economy presents a complex mix of challenges and opportunities for both businesses and individuals alike. Especially in times of uncertainty and market volatility, navigating this landscape requires a blend of strategic foresight, adaptability and informed decision-making.

Below, 18 Forbes Finance Council members explore strategies for effectively navigating these unpredictable conditions. From diversifying investments to adjusting budgeting practices, their top-recommended practical approaches can help mitigate risks and capitalize on potential opportunities.

1. Invest In Different Areas

To help with economic ups and downs, diversify your investments. Spread them across different types of assets, industries and places. It's like not putting all your eggs in one basket—it keeps things steadier when the market gets bumpy! - Ehud Gersten, Perch Wealth

2. Focus On Margin

The game of transitioning from saver to investor is called “margin.” That’s the spare area between your load and your limits. That’s another way of viewing income versus expenses; expenses being “load” and income being “limits.” Margin leads to patience, better tax treatment and an overall better investing experience. - Gil Baumgarten, Segment Wealth Management

3. Consider Your Long-Term Goals

Maintaining a long-term perspective is the antidote to making short-term decisions when navigating uncertain or volatile times. Market fluctuations are the result of a functioning and healthy market and economy. Creating a long-term thesis and view on a strategy helps to mitigate any potential emotional or reactive decisions that can compromise actual value creation, which takes time. - Cynthia Dalagelis, Amalgamated Bank

4. Maintain Sufficient Cash Flow

Make sure you have adequate liquidity or access to a line of credit. Economic uncertainty and market volatility can be nerve-racking but usually also very opportunistic. Being well-positioned to avoid a threat or capitalize on an opportunity is the best strategy. - Christopher Foder, CExP, First Financial Group - Meridian Financial Associates

5. Find Ways To Generate Sales

Just as in politics, the adage, "It's the economy, stupid" is very true. In times of uncertainties and volatility, it is "It's sales, stupid." The ability to generate sales with strong profit margins carries you through volatility. Creating memberships or subscriptions and recurring revenue also plays a key role in pushing through uncertainty. Also, eliminate expenses that don't generate ROI. - Leo Kanell, 7 Figures Funding

6. Ensure Competent Cash Management

Business leaders need to be diligent about their return on capital in good and volatile markets. Too many businesses lack a liquidity strategy, which can spell disaster during rough times. Spend time evaluating your revenue streams and ensure investments align with your strongest assets or areas for the greatest growth while leaving some capital aside for emergencies. - Lee Henderson, EY

7. Confirm You Have Ample Liquidity

As the economic environment continues to fluctuate, cash is a priority. Ensuring you have ample liquidity to maneuver through uncertainty while maintaining employee engagement is essential. The ability to provide the tools and resources employees need to thrive makes it easier to tackle the business challenges that tend to arise during periods of market volatility. - Omar Choucair, Trintech

8. Stay Focused And Don't Panic

Companies should stay focused on long-term strategies regardless of market volatility. Instead of panicking, maintain a business-as-usual posture while also monitoring for industry developments that may align with this strategy. By tuning out the noise and following this strategy, companies will be best positioned to pursue the right, data-tested opportunities, regardless of market conditions. - Anthony Georgiades, Innovating Capital

9. Maintain Access To Capital

One of the most challenging aspects of market volatility is actually predicting how long it may last—and then, what parts of your business it may impact most. Maintaining access to capital, regardless of whether you need it right away, is essential. Especially now, establishing and keeping access to operating or growth capital is an important hedge against uncertainty. - Eyal Lifshitz, Bluevine

10. Refrain From Speculating

Diversify your portfolio across stocks and bonds and avoid speculation when you can't afford it. Make sure your investments are liquid, and take advantage of market dips to buy quality investments when they are on sale. If we hit a market correction, which is a normal part of the economic cycle, your portfolio will recover faster if you adhere to this strategy. - Tammy Trenta, Family Financial LLC

11. Remain Steady

Often in volatile markets, when things are going well, confidence and excitement lead to a temptation to buy. On the other hand, when the market is dropping fast, there’s a tendency to despair and sell. Each might be the wrong action. It’s generally better to be steady. Keep in mind that cash devalues over time given inflation, so cashing out early could hurt your buying power in the long term. - Ram Palaniappan, EarnIn

12. Ensure A Return On Cash Investments

Have access to cash and maintain effective cash management, whether that is a line of credit, cash reserves or other liquid options. The ability to fill in the gaps or smooth out the swings from feast to famine to feast again can ensure the company survives. Constantly evaluating and ensuring there is a return on all cash investments is imperative to lessen your reliance on short-term debt or cash reserves. - Shannon Power, Scope AR

13. Find Investments That Protect Your Principal

One way in which individuals can navigate and overcome the stress that comes with economic uncertainties and market volatility is to save into investment vehicles that have principal protection and yet, allow you to capture the upsides of various market indexes. - Bob Chitrathorn, Wealth Planning By Bob Chitrathorn of Simplified Wealth Management

14. Plan For The Unexpected

Keeping a business emergency fund and creating protocols for employees during unprecedented times is vital to your business’s survival. By positioning your team and business for stability amidst volatility, you create better conditions to continue to serve your clients. - Justin Goodbread, WealthSource Partners, LLC

15. Diversify Your Assets

Diversification is a key strategy to navigate economic uncertainties and market volatility. Spreading investments across different asset classes, industries and geographic regions helps to safeguard against downturns in any particular sector and enhances the overall resilience of the investment portfolio, enabling businesses to adapt more effectively to changing economic conditions. - Gianluca Sidoti, Tradetector-The Wealth Company International FZCO

16. Use Behavioral Psychology

Behavioral psychology is a fresh approach to economic and market instability. Employ "nudging." Nudging manipulates choices via psychology. Would you like customers to prefer you over your competitors? Promote switching via incentives. Employees can also accept new company rules with a nudge. To improve confidence, we might train or assist employees apprehensive about new roles or initiatives. - Neil Anders, Trusted Rate, Inc.

17. Identify And Cater To Your Best Customers

Amid economic uncertainties, businesses must focus on fundamentals—and the corporate foundation is cemented by the customer. Use the volatile environment to identify, nurture and retain your best customers by providing them with significant value to secure their loyalty. During market volatility, customers seek solutions providers—offer great solutions and you’ll have the customer for life. - Greg Bassuk, AXS Investments

18. Adapt And React

The CFO’s role is a gray area with some repetitious stuff and much hard work. Being adaptive and reactive is the key to maintaining sustainability. Identify what matters to you, build a great team and change horses for the right reasons. It is essential to balance being hands-on and focusing on a strategic orientation approach. - Pankaj Vasani, Cube Highways InvIT

Forbes link: https://www.forbes.com/sites/forbesfinancecouncil/2024/01/23/18-expert-strategies-for-promoting-economic-agility/