One of the best things you can do to recession-proof your portfolio is to diversify your investment. Including stocks that historically perform better during a recession is a good start. Keep in mind that there are pros and cons to a recession-proof portfolio.

Investors typically flock to fixed-income investments (such as bonds) or dividend-yielding investments (such as dividend stocks) during recessions because they offer routine cash payments.

The best recession stocks include consumer staples, utilities and healthcare companies, all of which produce goods and services that consumers can't do without, no matter how bad the economy gets.

Cash, large-cap stocks and gold can be good investments during a recession. Stocks that tend to fluctuate with the economy and cryptocurrencies can be unstable during a recession.

Here are seven ways to prepare for a recession:

• Focus on building a budget.
• Limit spending.
• Build an emergency fund.
• Pay off debt.
• Diversify investments.
• Add multiple streams of income.
• Secure a recession-proof career.

What industries are recession-proof? Consumer staples, vices, healthcare, education, defense, utilities, budget travel, and premium luxuries are seen as recession-proof.

Food and grocery items Food is always in demand, so it's a good bet for a recession-proof business. While many consumers stated they will cut back spending in this category, they still need to buy groceries.

Necessity items Products that are essential for daily life, such as food, cleaning supplies, and personal hygiene products, may be in high demand during a recession as consumers try to cut costs by limiting non-essential purchases.

Examples of businesses and industries that historically have been recession proof include:

1. Financial advisors and accountants.
2. Child services.
3. Health care.
4. Auto repair.
5. Property management.
6. Home repair/contractor.
7. Cleaning services.
8. Grocery store.

9 high-dividend stocks

What industries are recession-proof? Consumer staples, vices, healthcare, education, defense, utilities, budget travel, and premium luxuries are seen as recession-proof.

Ten recession-proof business ideas (with real examples)

• Pharmaceuticals.
• Care work.
• Accounting.
• Financial planning.
• Beauty products.
• Beauty salons When times are tough, we still want to look good.

Build up your emergency fund, pay off your high interest debt, do what you can to live within your means, diversify your investments, invest for the long term, be honest with yourself about your risk tolerance, and keep an eye on your credit score.