Planning for Financial Hardships and Emergencies (10 Simple Things You Need To Action Today)

Life can bring many unexpected financial hardships that can cause significant stress.

Even with a well-managed and organized budget, some unexpected events may leave you wondering how you will take care of your family.

Fortunately, the sooner you plan for these situations and prepare yourself for them, the better.

A sudden financial emergency or a long-term financial hardship doesn’t have to be the end of the world.

No matter what you do, things happen in life.

Sometimes it feels like you never get a break, but the truth is, we always have breaks from disasters.

The reality is, we do not always plan for the future, although we should.

Start planning immediately if you want to weather a financial hardship or emergency.

In this blog post, we’ll share 10 simple things you need to do today to handle successfully and plan for any financial emergencies or long-term financial hardships as soon as they appear.

However, let's first distill the financial hardships meaning and provide examples of financial hardships or emergencies.

What are Financial Hardships? Financial Hardships Meaning

Financial hardships are when you can't afford to pay your bills or have too little money to live on.

They can come from a variety of things, like losing your job, not being able to afford your rent or bills, or having to use up all your savings just to get by.

Financial hardships can make it hard to get ahead and can cause a lot of stress in your life.

Financial Hardships Examples

1. A person may experience financial hardship when their income is reduced or they have to borrow money to cover expenses.

2. Someone may experience financial hardship when they lose their job and cannot find another one that pays a similar salary.

3. Someone may experience financial hardship when the value of their investments decreases, causing them to lose money.

10 Simple Things You Need To Action Today To Ensure You Are Well Prepared For Financial Hardships

1. Build Your Emergency Fund Now 

It's time to plan and set up your budget now so that you can handle most emergencies without getting hurt.

Not having an emergency fund can be detrimental to your financial well-being.

If you don't have an emergency fund, make this your first order of business.

2. Use an Emergency Fund Calculator

Use this emergency fund calculator to calculate how much savings you will need in the event of financial hardship or emergencies.

3. Take a Beat

Don’t make decisions during an emergency; instead, follow your emergency procedures.

Make decisions only after you have studied your choices from your emergency plans.

If you don’t have plans, give yourself a break before making potentially devastating choices.

4. Evaluate Your Needed Expenses

It is important to create a bare-bones budget in advance so that you know what it looks like if something were to happen.

For example, you don’t need cable TV, an unlimited mobile plan, or your daily coffee fix.

5. Create a Budget For Your Current Situation

Draw up a budget as soon as possible with the intention of putting money towards bills, savings, and investing.

If you have debt please include this on your budget as the priority would be to repay this.

A budget is useless if you do not adhere to it.

So please stick to it.

A template can be found here.

6. Get a Better Deal With Credit Card Companies

Contact your credit card company right away if you have consumer debt.

You might be able to delay or change your due date, saving you money.

Also, look for a better deal early on.

Creditcards.com works with you to choose the most appropriate credit card for your financial situation.

7. Check Your Insurance Policies

You might be paid under life insurance policies if you become sick.

Check your policies to see if you're eligible for anything.

No one is going to tell you; you have to check.

Looking for life insurance?

Policygenius.com allows you to obtain various life insurance quotes from many service providers.

8. Start a New Income Stream

There are usually ways to earn extra money, such as caring for dogs, delivering groceries, driving for rideshare companies, and other online jobs such as getting paid to use Facebook and Instagram, live chat jobs working from home, or affiliate marketing.

9. Sell Your Stuff

It’s often best to get rid of unwanted items rather than let them pile up during a crisis.

Poshmark, Mercari, eBay, and Facebook Marketplace are all excellent options.

10. Rebalancing Your Investment Portfolio

It is imperative to look into rebalancing your portfolio to ensure it carries an appropriate risk profile.

After the long run-ups of the market, one should move some investment into more liquid saving accounts.

Looking for an excellent personal investment management tool? Personal Capital has one of the best apps on the market.

Conclusion

All of us have financial hardships at one time or another, so it is important to have a plan and be prepared to handle them.

Sure, you can't control the severity of it all, but by working towards having a plan and doing the preparatory work necessary to make sure it works, you'll be better able to handle whatever comes your way.