There are many financial situations that make my heart start beating and bring on those all-too familiar feelings of panic. The “what-if” scenarios are the ones I dwell on, wondering if I can handle such a situation and what I will do when/if the time comes. For many Americans, this “what-if” scenario has become a reality over the past few years. I have been lucky to avoid such a situation but know that it could happen very easily. The top financial fears I have include:
2. Defaulting on student loans
3. Car emergency
4. Getting behind on my credit card payment
Unemployment would ultimately affect my entire lifestyle, which is why it will probably always remain #1 on the list. The other three are financial problems I would not like to deal with, but I feel that I have a bit more control over these. In order to combat my fears, I have done some prep work to ease the burden of such a situation.
First, I set up an emergency fund. It’s modest, but it would hold me over for a few months if I lost my job or incurred a large expense such as a car repair or health emergency.
Next, I have broadened my skill set to make myself more desirable to employers. If I lost my job, I would be able to broaden my job search if the need should arise. I am also prepared to go back to waiting tables or working random part-time jobs to bring in some income until I am able to get back on my feet.
Finally, I have organized all my financial documents. If an emergency situation did occur, my financial records are clean and organized. In addition, I keep a list of contact numbers for those handling my accounts. Creditors are often willing to work with you if you contact them to explain your situation and try to get something worked out as soon as you can rather than waiting until you have defaulted on your loan or missed payments.
What are your financial fears? What strategies do you have in preparing for or dealing with such situations?
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