Is Your Family Prepared For An Unexpected Event?

The last ten years exposed many people from around the world to natural disasters like Hurricane Katrina in the United States, the bushfire crisis in Victoria, Australia and the latest tragedy caused by Typhoon Haiyan in the Philippines. It’s a sad plight and millions of people are displaced, hungry and needing financial assistance badly.

But natural disasters are not our only worries. Technology, for example, makes our lives easier but you may one day find yourself in a position where you have been replaced by a machine. Such horror, but it could one day become a reality. How prepared are you for unexpected financial events? Are you one of those people who’s still living from pay check to pay check? In this article, find out how you can manage and control your personal finance.

Participate in Your Organisation’s Scenario Building Exercises

To some people, creating scenarios can be a bit odd. They want to enjoy life, earning a lot but still unable to meet financial obligations. Seems quite a trend these days and even if there is substantial increase in their salaries, most wage earners are still caught in that rut.

If you belong to a company that values long term planning, then by all means join your organisation’s scenario building exercises. These resourceful activities aim to strengthen a person’s ability to make sound decisions during a crisis. Employees who join these drills tend to be more financially stable than their co-workers who’d rather not think about the future.

Start an Emergency Fund

I’ve heard of so many friends and colleagues say that they want to start an emergency fund. But I haven’t heard a success story from any of them so far. When I got around to asking them what happened to their so-called contingency plan, they related that there was never enough money after paying off bills. That figures.

The secret to successfully saving a substantial amount is to put aside the money for the emergency fund first. Initially, you should be able to save six months of your income while you still can. Of course, you can aim to save much more. In the event that you lose your job or get sick, you’ll feel more secure knowing that you have stashed money in a bank.

Fix that Credit Score

License: Creative Commons image source

Damage to your credit score can be nerve wracking. I understand how hard it is to keep up with bill payments, especially if you lost your job and just recently got back on your feet. The usual cash advance loans can be quite difficult to obtain and that again, is something that’s keeping you awake at night.

What if there is an emergency in the family and I need an instant cash loan?
Will I have a problem with my online loan application if my credit score looks bad?

Questions like that can make you feel insecure about the whole future. Although a reputable company can offer you a bad credit loan, repairing your credit score will get you the best rates and that only means you pay less in interest. Aside from employing a third party who can help you fix your credit score, here’s what you can do:

  • Call your bank or credit provider and negotiate about payment terms.
  • Consider getting a loan to pay off all your debts. In that way, you basically have only one company to “answer to.”
  • Lay off the shopping sprees for a while. You may not notice it but buying that $150 dress that you absolutely don’t need can put a huge hole in your pocket. That money can go to paying off your debts!

Repairing the damage is not impossible but it may take some time. After all, the world was not built in a day. Unexpected life events are bound to happen and the best to do is to have a clear financial plan all laid out for you.

By Debra Wright

A self-professed geek, Debra Wright has dreamt of being a writer since as long as she could remember. She has recently written about a number of topics online, including saving money, and hopes to get more people interested in personal finance through her written work.

Tim Esterdahl

Tim Esterdahl is the editor of IFCS blog. He is a married father of three and enjoys golf in his spare time.

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