We all have our challenging moments. We can’t control a crisis when it happens. Some people just lose their jobs from a catastrophe like a pandemic. Sometimes, you handled your finances diligently, or maybe you blew your budget, but life happens. So how do you survive this crisis?
You can use these steps to get back on track. But with hundreds of financial advice, which one should you follow?
During these trying times, we can break some in times of need. And here are 7 personal financial rules you can break during a crisis.
Using Your Emergency Funds
It’s a general rule to save up around 3 to 6 months worth of expenses in your emergency fund. Don’t touch it until you have an emergency.
If your finances are in deep crisis, and you can’t seem to find the money, you can touch your emergency fund. After all, I think it qualifies for one.
Yes, no one had a health issue or an accident. But if you have a financial crisis, you can resort to living off your liquid emergency funds. Just make sure to build it once again afterwards.
Paying Bills on Time
When we are in a severe financial crisis, sometimes we have to choose which necessity to prioritize. With this, it’s okay to momentarily have late bill payments.
If you need food with your money today, better prioritize it compared to your other bills. I’m not saying that you don’t pay them at all. Just make sure to have a list of all their deadlines and surcharges. And then, budget accordingly.
Leaving Balances in Your Credit Card
A credit card is not free money for you to spend on everything. There are a lot of credit card mistakes to avoid. But it’s okay to leave credit balances for now and just pay the minimum if you can.
Yes, there will be interest. But if you can’t make ends meet, it’s better to use that money for survival first.
Saving 10% of your income
To reach financial freedom, we must save a portion of our income and let it grow from investing. But if you’re in a crisis, how can you think of the future when you are burdened with the present?
Instead of saving 10%, you can keep a smaller amount for now. From 10%, you can save 1% if that’s what you can afford. And it’s perfectly okay as long as you increase it when the times are better.
Saving for Investments in the Future
Want a house or car in the future? Now is not the right time to save for it. You are in the midst of survival. You need all your liquid assets to be used on necessities first.
When you have a better grasp on your finances, you can try investing after. It’s okay to be slow because once you fix your problem. You can get back to targeting your dreams after!
Withdrawal from Retirement Accounts
You might have money in your retirement accounts. It’s a golden rule to just keep them growing so that you’ll be secure in the future. But during trying times, you may break the rule.
There might be extra charges when you withdraw from them. Money can be earned. Just build them up again when you survive the crisis at hand.
Borrowing Money from Your Family and Friends
Borrowing money from your peers is frowned upon when you are building your financial stability. But today is an emergency.
If you can’t handle it alone, it’s okay to borrow money from your family and friends for now. But make sure to pay them up so that you maintain a healthy relationship after the crisis.
Find a Remote Working Job
Challenges are here to make us grow into better people. And sometimes, it’s hard enough that forces us to shift our core mentalities. After all, your habits now brought you to this situation.
But learn to forgive yourself. Stand up again and try one more time to reach your goals. And maybe, an online job might help you be more financially stable. Check out this link for opportunities you might be interested in. Cheers!