A financial crisis can leave you devastated, to say the least. The fear of it can be a nightmare. Predicaments like losing your job, sudden medical emergencies or impoverishment can make you rethink your life choices. Such events would need you to make some urgent changes in your lives.
Being prepared, even a little bit, can help lessen the worries that might keep you awake at night. While I am no financial expert myself, I would like to give you some tips on how to deal with a financial crisis. Don’t worry, I have carefully curated these after hours of research so this won’t be a complete waste of your time!
1) Identify your problem areas: Of course, the first step will be to identify what it is that you’re facing a problem with. It is an indication of a larger issue at hand. Uncover the issue and then come up with a permanent solution. And not just permanent but something that will prove effective in the long run as well. Do not procrastinate! Ignoring this will not make it vanish. Get up, analyze, diagnose!
2) Budget: Budgets are important, people! Take a note. It is one of the best ways to deal with the financial crisis you’re in. Plan your spending. For me, the best way has been – lists! Make lists for your monthly needs, stick to it. It will help you track and adjust your spending and accordingly make changes wherever necessary. Lists help you cut, slash and save!
3) Get your priorities sorted: This is essential. It will enable you to get back on your financial racecourse. Check into your credit card payments, pay your mortgages, and get a better credit card deal. If you don’t have insurance, get it. If you have one, check what it covers and what it doesn’t cover. Look for places with lower interest rates for any loan that you’re planning to shoulder.
4) Minimize bills, maximize asset value: I think this point speaks for itself. Once you start keeping track of your expenses, you minimize. What it means is, throw all unnecessary expenses out the window. Review your budget and you will immediately spot your problems. Get rid of even those expenses that might set you back an extra 100 rupees. That is saving. Also, rather than high-class marts, try local shops for your groceries. I can vouch for the savings! Look to maximize your liquid savings. Resources like savings, deposit certificates, and short-term government investments don’t see many fluctuations in their values. Turn to these for help.
5) Track progress at each step: Once you have realized your problem areas, come up with ideas to tackle it. Make some realistic plans around those ideas. Don’t get too overly optimistic. Keep your goals and plans real. Prepare them according to your capacities and you’re good to go!
So these are some ideas to deal with a financial crisis.
I agree that the financial crisis can be incredibly inconvenient and unpredictable. But with a proper plan in place, we can overcome this setback.