In the midst of pandemic, realize that not everything can be planned and we have to evolve regardless.
Graduation, getting that job, planning a wedding, beginning a family – Happy and most likely Planned!
Being quarantined, the loss of a job, battling an illness or divorce. Unexpected, life changing, Not Happy and most likely Unplanned!
Happy and planned events usually come with a plan for savings, budgets, and time qualifiers. Unexpected, unplanned events can be considerable and devastating; both emotionally and financially.
This is a time to think about your finances, save for a rainy day, create and test scenarios so you know where you stand, how will you manage for 2-3 months, what determines your stability and how you can make your money last.
Gather your facts. What assets do you have? Cars, homes, investments, bank accounts, life insurance policies, time shares, retirement accounts, income? Now what about your debts? Mortgages, car loans, lines of credit, credit card debt, child care?
Make assumptions. How long can you manage your minimum payments without income? How much equity do you have in your property? At what age are you planning to retire? What if the market bottoms out and you lose your retirement? Can you reduce spending?
Make a plan. Review and update your assets/debts on a regular basis, try every 6 months. Start paying down debt, higher interest loans first. Sell assets that aren’t being used to put aside for savings or pay down debt. Will your circumstances change down the road? If so, how does that affect your lifestyle and budget? Can you downsize? Is there any opportunity to bring in other income?
Looking toward the future, especially after an upsetting event, is a sign of hope.
When "life happens," use your projections to pivot, adjust your assumptions, and plan again for the future.
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