By most measures, the new year has started well. However, economists and business leaders predict that the market and the economy are heading for tougher times.

Year-to-date, the S&P 500 and the Dow Jones Industrial Average are up about 4% and more than 2%, respectively, while the Nasdaq Composite is up 5.9%.

Yet inflation remains a persistent problem. The consumer price index for December showed that prices had cooled 0.1% compared to the previous month, but were still 6.5% higher than a year ago.

“The reduction in inflationary pressures is evident, but it doesn’t mean the Federal Reserve’s job is done,” said Greg McBride, chief financial analyst at Bankrate.com. “There is still a long way to go to reach 2% inflation.”

Even if the Fed’s fight against inflation succeeds, it will come at the price of a hard landing for the economy, according to a survey of chief financial officers conducted by CNBC. Economists have been predicting a recession for months, with most seeing it begin early in the year.

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To make the most of the current climate, advisors are recommending a few key money moves for the year ahead.

Here are their top four strategies for protecting yourself against stock market volatility, rising interest rates, and geopolitical risks — not to mention fears of an impending recession.

“Now is a good time to pay off some of those higher-interest outstanding loans,” said David Peters, a financial advisor and chartered accountant with CFO Capital Management in Richmond, Virginia.

Credit card rates in particular are now averaging more than 19% — an all-time high. Those annual rates will also continue to rise as the Fed continues to raise its benchmark rate.

“We’ve been pretty spoiled in the markets for so long,” said Peters. In the past, it used to make financial sense in some cases to tap cheap credit for a larger purchase, instead of withdrawing money from a savings or investment account. Now, “we have to reverse our way of thinking.”

Consider this: “If you have a loan with a 6% interest rate and you pay down the loan principal, that’s almost the same as a 6% return on your money in the market,” he said.

If you currently have credit card debt, “grab one of the offers for zero percent or a low balance transfer rate,” McBride advised. Cards offering 15, 18 and even 21 months with no interest on transferred balances are still widely available, he said.

Once you’ve paid off your debt, Peters recommends setting some money aside in a separate savings account for emergency expenses.

“Online savings accounts can be a way to make money during times when other investments may not pay off,” he said.

While some of the highest-yielding online high-yield savings accounts are now paying more than 3.6%, according to DepositAccounts.com, even that can’t keep up with the rising cost of living.

Ted Jenkin, CEO of Atlanta-based Oxygen Financial and a member of CNBC’s Advisory Board, recommends buying short-dated, relatively risk-free government bonds and laddering them to ensure you earn the best rates, a strategy that involves investing bonds up to the end of their term.

“It’s not a huge return, but you’re not going to lose your money,” he said.

Another option is to buy Federal I Bonds, which are inflation-protected and nearly risk-free assets.

I-bonds currently pay 6.89% annual interest on new purchases through April, compared to the 9.62% annual interest offered from May through October 2022.

The downside is that you can’t redeem I-bonds for a year, and you’ll pay interest for the last three months if you cash them in before five years.

Once you’ve paid off your high-interest credit card debt and put some money aside, “it may be a good move to put more into your retirement accounts now,” Peters said.

You can defer $22,500 to your 401(k) for 2023, higher than the $20,500 limit in 2022. The new provisions in “Secure 2.0” will further expand access to the retirement plan and provide more options for saving in the future Peters said, including making it easier for employers to make contributions to 401(k) plans on behalf of employees paying off their student debt.

Even if you balance contributions with short-term goals, you still need to contribute enough to take full advantage of company matches, he added, which equates to an additional return on your investment.

“Investors willing to take on additional risk might consider ‘buying the dip’ by looking at sectors that have struggled particularly and may now be undervalued,” said certified financial planner Bryan Kuderna, founder of Kuderna Financial Team in Shrewsbury, NJ, and the author of the upcoming book, “What Should I Do With My Money?”

“Tech took it on the chin. Amazon lost half their market cap. If there was too much pullback, there might be an opportunity,” he said.

Kuderna recommends dollar-cost averaging, which helps smooth out price fluctuations in the market. Investing at set intervals over time can also help you avoid emotional investment decisions.

However, a long-term horizon is critical to this kind of approach, Kuderna added, meaning you have to be prepared to leave that money alone.

“The general advice I have is don’t watch the market too closely, people get emotional and mistakes happen.”

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