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Is your portfolio ready for a recession?

The recession is coming.

We just don’t know when.

Are you ready?

It’ll probably hit the S&P/ASX 200 (INDEXASX:XJO) for six. And discretionary retailers like Myer Holdings Ltd (ASX:MYR). Even the likes of Sydney Airport Holdings Ltd (ASX:SYD) won’t be totally immune.

Here at The Motley Fool, we reserve a special disdain for those who do nothing but predict doom and gloom. There’s no shortage of them: the bears who’ve been predicting a market crash every year since 1971, the doomsters who keep telling us that the end is nigh. The double-dip US recession. Etc, etc, etc…

But there is a recession coming.

So what do you do? You don’t lose sleep worrying. You don’t go to gold. Or cash. You don’t give up.

But you also should mentally prepare.

And diversify.

When the recession hits, you don’t want to be highly leveraged to consumer spending. And if it’s going to be an Aussie-dollar-thumping decline, you don’t want to be neck deep in importers.

Instead, be diversified. Geographically. Industry-wise. Currency-wise. Know what you own, and be ready to feel real pain as you ride the choppy waves. But keep investing.

Dividends can ease the pain — at least you’re getting something while your shares swoon. And you can reinvest them when the market is low… that’s a sweet deal. Here’s one company that our dividend expert likes a lot.

A Big, Fat, Fully Franked Dividend

This company's dividend is almost the stuff of legends. Since it started paying dividends in 2007, it has increased its payout to shareholders every single year, a run that includes 21 consecutive dividend increases.

Based on the last 12-months of dividends, its shares are currently offering a fully-franked 4.8% yield, which grosses up to almost 7% when those franking credits are included. And in stark contrast to the likes of Commonwealth Bank and Telstra, this company just increased its dividend by over 13%, and guided for 2017 profits to grow by 20%!

Discover the name of this "new breed" of blue chip along with 2 others in our new FREE report "The Motley Fool's Top 3 Blue Chips Stocks For 2017."

Click here to receive your copy.

Motley Fool contributor Scott Phillips (TMFGilla) has no position in any stocks mentioned. The Motley Fool Australia owns shares of Sydney Airport Holdings Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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