With all of the weather events that have been happening across the country and across the world, this topic came to mind. Wherever you are, I hope everything is OK in your neck of the woods!
Have you ever heard that saying, “the calm before the storm?” Sometimes we use it at work to refer to a period of downtime (they don’t happen very often-trust me!). Basically, when things get quiet, we worry that that “storm” is right around the corner. Maybe we’re pessimists, or maybe we’re realistic (or maybe both). But none of that really matters. What does matter is our ability to plan for and weather the “storm”.
Here’s my plan for weathering financial storms:
- Save for emergencies before they happen. It’s not a matter of, if an emergency will happen to you, it’s a matter of when. Examine at the state of your finances, taking into consideration the size of your emergency fund and the types of emergencies that realistically could happen. You don’t have channel Ms. Cleo to predict that your 15 year old car might die, or your 40 year old roof might leak. If there are big expenses coming your way, try to save for them. Barring disasters, illness etc. I can pretty realistically estimate how much money I need in my emergency fund.
- Plan for the worst and hope for the best. I always assume that emergencies will cost me far more than they actually do. When I’m budgeting for an emergency car repair I guess high. For example, if I take my car in to the shop, I assume it will cost me $1000 and when it “only” costs $500, I’m pleasantly surprised.
- Don’t panic. Take a deep breath and relax. This one is probably the hardest for me. Although I may look calm on the surface during an emergency, I’m often screaming inside.
- Sleep on it. When possible, I always wait overnight before making an important financial decision during an emergency. What seemed like an emergency 8 hours ago, often feels much more manageable the next day.
- Talk it out. Talk to friends and family if they’re supportive. You’d be surprised how many people have been through a similar financial emergency. Even if friends don’t know exactly what you’re going through, most adults have experienced some sort of financial emergency at one point or another. When I’ve been in the middle of a financial melt-down I’ve found it reassuring to know that others have been through financial emergencies and survived.
- Ask for help. It’s hard for me to ask for help, but I really need it sometimes. Don’t be stubborn and suffer in silence. If a friend offers to make you dinner or watch your kids (so you can handle a financial emergency) take them up on the offer! You don’t have to be superman or superwoman.
- Stick to the plan. If you had a plan for how to handle an emergency before it occurred, stick to the plan. It’s easy to get flustered or frustrated and overspend. If you planned to spend $5,000 for a new car before the old one died, don’t spend $7,500 in the heat of the moment.
- Remember, money is just money. When both of our cats got sick, I was an emotional wreck. I was so sad that our boys were ill and totally freaked out by the insanely large vet bills. One night a few nights into the madness, Eric told me something that really stuck with me, “money is just money, we’ll make more.” At the end of the day he was right. We had money set aside for an emergency, and we had an emergency. I don’t regret spending the money for one second, money is just money!
- Think about the sunny days. In the middle of a financial crisis it’s hard to remember what the sunny days were like. Things will get better with time, even if it feels like the end of the world in that immediate moment. When our furnace burned up at Christmas, I felt completely deflated. All that money saved was quickly spent on something I wasn’t even planning on buying. Throughout that whole ordeal I had to remind myself that the emergency was only a bump in the road and things were going to get better.
How do you weather a financial storm?
Image: Diana Robinson