There are many things in life that can happen unexpectedly. Whether it is being let go from a job, an illness, accident or even something positive like a pregnancy, no matter the situation, have you asked yourself, “Am I financially prepared”? Being prepared in advanced is the best way to handle any unexpected events that even the biggest planners may be unprepared for. We’ve helped to organize some of the ways you can be ready if something unexpected were to happen.
Assess the Situation:
Knowing where you stand financially individually or as a family can help or hinder your situation. It is times like these where you may realize how out of date your financial planning or other documents may be. But by staying on top of your finances and knowing your cash flow of what’s going in and what is coming out can really affect your financial position. Changes may have to be made to your current financial plan, but being organized and knowing where you stand is the first step when trying to wrap your head around any financial situation.
Do you have an emergency fund in place? We’re talking about more than just your savings account, but being financially prepared for any situation. An emergency fund is also one of the best things you can do to help your finances in general and give yourself reassurance knowing that if something happens, you will not immediately be in a crisis. Creating a financial back-up plan of the things that you could cut back on if needed or any sudden changes in expenses are much easier to implement once you’ve assessed your situation. No matter your budget, there are many ways to start an emergency fund.
Starting with small contributions, treating your emergency fund as a bill and getting into a routine of contributing funds are only some of the small steps that can make a big impact in the future. Everyone’s emergency fund will be different depending on their situation. There are also various opinions as to how large an emergency fund should be. This leads directly into the next tip on why you should then make plans to seek expertise with any questions you may have in regards to your emergency fund and to help give a second look into your assessment.
Ask an Expert:
Going to see a financial advisor or planner is something you should be doing every so often, not just when a situation occurs. Once you have a good concept of your financial situation and have begun to take action, having a professional take a second look at everything can help set you up to be financially successful. It can be the simplest things that a financial advisor can find that can greatly contribute to your savings. These things can include options for lower interest rates on any current accounts you are using, a different type savings account that will help you generate more interest, any investments you may currently have, or analyzing your purchases and showing you where you can cut back. Having regular updates and second opinions from a professional is an easy way to make sure you are taking the right steps financially no matter the situation.
Do you have any other ways to financially prepare for the unexpected events in life that happen? Let us know your tips in the comment section below.