How to Recession-Proof Your Retirement Income Before Summer 2026

There will be another recession in the near future, of that you can be certain. When it comes along is harder to determine. Given that consumers were already tightening their budgets before high oil prices arrived, there's a legitimate reason to fear this summer could be tough economically. The time to prepare is now.

If you don't want to run to cash, the best way to stay invested amid recessionary fears is to focus on resilient sectors like consumer staples and healthcare. Some solid stock options right now are Coca-Cola (NYSE: KO), Procter & Gamble (NYSE: PG), Johnson & Johnson (NYSE: JNJ), and Medtronic (NYSE: MDT). Here's a quick look at each one.

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You will continue to buy toilet paper and food

Consumer staples businesses tend to be resilient because they sell low-cost, everyday necessities. Think toilet paper, deodorant, soap, beverages, and food. You aren't going to stop buying any of those items in a recession, and neither is anyone else.

The resilience of well-run consumer staples companies is highlighted by Coca-Cola and Procter & Gamble, which are both Dividend Kings. You can't increase dividends for 50+ years by accident; it requires a good business model that's executed well in both good times and bad. And right now, they both offer well above-market yields of 2.6% and 2.9%, respectively.

They are also two of the world's largest consumer staples businesses. Each can stand toe-to-toe with any peer on brand strength, distribution capabilities, marketing skills, and innovation. Right now, beverage giant Coca-Cola's price-to-earnings ratio is a touch below its five-year average, suggesting it is reasonably priced. Consumer products maker P&G's P/E is even further below its five-year average, with the stock perhaps looking a bit on the cheap side.

Medical care isn't optional

Healthcare stocks are equally resilient to economic swings because delaying necessary medical care can lead to highly undesirable outcomes. If you survive a heart attack during a recession, you are likely to get the stent your doctor recommends put in right away. And you'll happily buy and take the pills being prescribed, such as statins, as well.

Two solid options in the healthcare sector are Johnson & Johnson and Medtronic. J&J is a Dividend King, while Medtronic's dividend streak is "only" up to 48 years. They offer dividend yields of 2.3% and 3.6%, respectively.

Johnson & Johnson is a bit expensive today, with a P/E above its five-year average. That said, it offers an attractive level of diversification, operating in both the pharmaceutical and medical devices segments of the overall healthcare sector. For more conservative income investors, it is probably worth paying up for quality and diversification if you are worried about a recession.

Medtronic is focused entirely on medical devices. Its P/E ratio is well below its five-year average. While the stock could offer good value, it is best suited for investors with a slightly higher risk tolerance. The company had become bloated and lethargic over time and has been working to slim down and increase its innovation and growth rate.

That process is still ongoing, but starting to show progress. For example, in the fiscal third quarter of 2026, it posted its highest revenue growth rate in 10 quarters. There's more work to be done, but given the attractive yield, you are being well compensated for waiting.

Don't go on your summer vacation unprepared

While you shouldn't sell everything you own and buy Coca-Cola, P&G, J&J, and Medtronic, you might want to consider adding some of these resilient businesses to your portfolio. That way, if there is a recession, you know that you have companies in the mix that can survive through an economic downturn in relative stride.

Reuben Gregg Brewer has positions in Medtronic and Procter & Gamble. The Motley Fool has positions in and recommends Medtronic. The Motley Fool recommends Johnson & Johnson. The Motley Fool has a disclosure policy.