If your investments lose half their value in a recession you are horribly over-leveraged. In any case, we are back to Feb highs now, and whatever loss you might have sustained no longer exists, unless you sold at the bottom.

The Dow went from 14k to 7k during the Great Recession of 2007-2009. The S&P 500 saw a similar loss of half its value. Index investing is generally considered a safe approach, not "horribly over-leveraged".

The problem with using the market as a savings account is the times large numbers of people need to dip into savings tend to coincide with the times the market is dipping.

That's what everyone says, but it's based on conventional monetary policy. We have modern methods now and we know the government won't let you starve, won't let you be kicked out, and won't let you receive no money.

If you don't use the stock market as your savings account, that's reasonable for your risk tolerance but the truth is that people have cottoned on to the true risk and they've adjusted their behaviour to match their tolerance.

A savings account shouldn't be your emergency fund to dip into. It should be a lockbox you don't touch, in which case buying the index regularly is a no brainer. If you need to dip into your savings, you need to be expanding your emergency fund before you can think about saving and investing.

A long recession means exhaustion of emergency funds, which means dipping into savings. No matter how well-intentioned you start out, eventually money runs out and that savings/investment starts to look like the remaining option.

Having to do it when it's depleted by market crash sucks.