Back in 2008, my husband and I were young, naive, and nearly 100K in debt. Two years into our marriage, we found ourselves living paycheck to paycheck and barely making ends meet. We had no emergency fund to fall back on and we had no clue how bad our spending habits had gotten.⠀
We got ourselves into a huge mess and we didn’t know how to get out of it.⠀⠀
Many families are going through unprecedented and unexpected financial difficulties right now. With most states issuing shelter in place orders and businesses closing aside for essential personnel, we’re seeing a spike in unemployment like never before. Many people who never imagined and never planned for losing their jobs are now finding themselves unemployed and unsure of where to go from here. ⠀
Is There a Lesson to Learn from Being in Debt?
Believe it or not, waking up to only $10 in the bank was a blessing in disguise for us. It taught us a lot more than we ever expected.⠀⠀
We had to really dig deep and ask ourselves if the kind of life we were leading was the kind of life we wanted our kids to grow up in. Only then were we able to make some changes that have lead to us living the debt free life we now enjoy.
What Happens When you aren’t Financially Prepared for a Crisis?
A crisis can take many different forms. It might be an unexpected medical expense, a totaled car that you still owe on, a house fire, or an unexpected layoff. It could also be a global pandemic that cripples the entire nation leading to a complete financial crisis. If I’d said that last one a few months ago, I bet you’d have looked at me like I had three heads – but here we are.
Needless to say, our current situation was not anything anyone was expecting. And, it’s hard to prepare for something that you can’t even dream up in your worst nightmare. But, when we aren’t prepared for a crisis, that is when we are most vulnerable .
If you have been caught off guard in this crisis without an emergency fund, you can use this time to really evaluate and reprioritize your family goals. It may not feel like it right now but maybe it is also your family’s blessing in disguise.⠀
How Can I Get a Budget in Place Quickly?
If you’ve found yourself in a tough spot financially for the first (or maybe, second, or third) time in your adult life, it’s not too late to take action. Don’t throw in the towel. With a little hard work, some tough decisions, and some smart budgeting, you can get yourself out of this mess.
But, the first thing you’ll have to do is let go of blame. You can’t begin to make the necessary changes in your habits if you are holding onto blame – of yourself or others. Then you’ll need to establish a reliable budget and to stick to it.
Here are some simple budgeting tips:
You need to know exactly how much money comes in each month and how much goes out.
Develop a system or process to pay down your debt.
Begin to spend within your means.
Add to your savings each month.
Following these simple steps will help you prepare for the next crisis.
How Can We Prepare Financially for a Future Crisis?
Please believe me, having your finances in order and being prepared for a financial crisis does not make you a DoomsDay Prepper.
The number one thing to do to prepare for a future crisis is to begin saving money in an emergency fund. Open a savings account and begin to add to it each month. Look into accounts with the best perks, like higher interest rates and lower fees.
Start small if you need to. Make sure that you are working to build it up each month and only taking from it in the case of an actual true crisis.
I Can Help You Out
Having been where you are now, I know the range of emotions you’re going through. I know I never want to be back in the place and I don’t want you to be either. That’s why I’ve made it my goal to help others take control of their financial situation through budgeting.
If you’d like budgeting support, let’s chat about 1:1 coaching! I’ll help you set up a systems that will work for your unique family. Info here! Get your info here!