Ukraine Conflict & Your Finances: 3 Steps to Protect Your Wallet

Worried about tensions overseas hitting your wallet? Here's what to do.

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Key points

• New data reveals that most Americans think the Ukraine conflict will impact their day-to-day finances.
• Now's the time to build savings, pay off debt, and secure a backup income stream.

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The start of 2022 has been a challenging time, to say the least. In January, many states were still bearing the brunt of the omicron surge. Shortly after, tensions began to boil over abroad. Right now, there's war in Ukraine, and there’s no telling how long that will continue.

All of this (plus our good friend inflation) has Americans worried about their finances. In a recent MassMutual survey, 73% of people believe the conflict in Ukraine will negatively impact the U.S. economy. And to be fair, we've already seen an uptick in gas prices as a result of the war abroad.

If you're concerned about the impact the Ukraine conflict will have on your wallet, it's imperative you take steps to secure your finances. Here are three to start with.

1. Shore up your emergency fund

Even in the best of times, it's a good idea to have a solid emergency fund -- one with enough money to cover three to six months of living expenses. If you're not there yet, try diverting extra money to your savings account in the coming weeks.

Granted, with living costs so high, that's easier said than done. But if you have the option to cut back on discretionary spending, now's a good time to cancel that cable plan and make more of your own meals rather than splurging on takeout three nights a week.

2. Chip away at high interest debt

If the U.S. economy takes a turn for the worse, job loss could become a lot of people's reality. If you're able to eliminate some of your current debts, you'll set yourself to better withstand that sort of situation.

Of course, paying off credit cards is by no means easy to do, especially right now. But once you've beefed up your emergency fund, you can take any extra funds and use it to whittle down your debt. You might also try consolidating your debt via a balance transfer or personal loan to make it more affordable to pay off.

3. Get a secondary source of income

A second job could make it possible to eke out more savings and pad your emergency fund or pay down costly debt. Plus, having that stream of income could buy you some peace of mind at a time when you may be worried about future job loss.

Though living costs may be high these days, the good news is that the labor market is still strong -- and that extends to the gig economy. You may have a fairly easy time lining up a steady side hustle.

It's too soon to tell what impact the Ukraine conflict will have on the U.S. economy. But if you're worried about how it might affect your wallet, take these steps to secure your finances before things potentially take a turn for the worse.