In some instances, you suffer the consequences of your own financial missteps. In other circumstances, events beyond your control throw you for a financial loop. In either event, when you find yourself facing financial hardship, it is essential not to panic.
Instead, follow these common sense financial tips to deal with the situation. With patience and diligence, you will begin to see an improvement in your finances. By continuing to practice these strategies, you can reduce the odds of future financial setbacks.
Practice Honesty and Transparency
As painful as it may be to make a financial confession to your mate or to another family member, it is always far worse for your transgressions to be exposed by happenstance because of the added loss of trust associated with hiding the truth. Therefore, if you have seriously overspent on your credit cards or made bad financial investments, bite the bullet and come clean to your spouse, partner or other loved ones.
Likewise, failure to write a will could place your family in financial jeopardy. It is almost as bad to write a will but fail to disclose its contents or its location to critical family members. To avoid misunderstandings and possible legal challenges, be sure that any possible heirs know exactly where they stand in relationship to your estate.
Approach Emergencies Head On
Unexpected serious illness or major repairs can wreck your household finances. If you have not already done so, begin putting money aside toward an emergency fund to deal with such unexpected circumstances. You should aim toward putting aside enough to cover at least three months worth of expenses; savings to cover six months of expenses is even better. Even if your income is severely limited, putting aside a small amount each week or each month helps you establish the savings habit.
If you are already faced with a financial emergency, face it head on. Contact your creditors to negotiate reduced or suspended payments. Collaborate with your family to determine which expenses that you can agree to cut, at least short term. Consider selling items that you don’t use or obtaining a second job to help you accumulate the funds that you need. If you begin to feel overburdened or resentful about the sacrifices that you are making, remind yourself that your circumstances are temporary.
Don’t Delay in Seeking Financial Assistance
No matter how well you prepare or how frugal you are, some situations are too big to tackle alone. When you realize that you are not making progress despite your best efforts, do not hesitate to reach out for help. . Free financial assistance from the Department of Human Services can help you uncover options that you may not have known about.
For instance, you may qualify for temporary benefits to help you through the worst of your financial hardships. Unsecured Greater personal loans or loans from the No Interest Loan Scheme may also provide additional funds. If you find that your bills spike at certain times of the year, inquire about bill smoothing programs from electric, gas and water utility providers to maintain bills within a manageable range.
William Caine has a passion for smart personal finance management. He enjoys writing about the basics of wise money decisions on financial blogs.