Dealing with Financial Setback - 1010 Park Place
— Life —

Dealing with Financial Setback

pin it

When you are faced with some sort of setback, be it divorce, a health crisis, the death of a loved one, or a natural disaster, very often it’s accompanied by financial stress. While this sucks mightily, it doesn’t have to ruin you. Here are some tips for averting a financial crisis when the rest of your life is running off the rails.

  1. Cut cash flow drains. At times of emotional upheaval it can be tempting to splash out on personal trainers, a renovation, or travel to get away from it all. Don’t. This is the time to cut out unnecessary expenditures, particularly ones that suck your bank account dry month after month like cleaning services, gym memberships, ski clubs, or the Jelly of the Month club. Try to eliminate all of the non-essential monthly drains until you have a very good sense of where you are financially. You can always add them back in.
  2. Meet with a trusted financial advisor. This is an emotionally fragile time and an expert can assess your new financial position with a clearer head than yours. If you do not have a financial advisor, call your bank and ask if they offer a free consultation or ask your friends who they use and see if you can buy an hour or two of their time.
  3. Don’t get hung up on keeping the family home. A friend of mine is a divorce lawyer, and she maintains that one of the biggest reasons women end up in a financial pickle is they try to keep the too expensive family home. Don’t compromise your retirement or your kids’ college fund to pay for a big house. If you want to keep in the same neighborhood, see if there is a smaller home, a townhouse, or a rental apartment. Your kids would rather move than have you worried sick at the end of each month.
  4. Don’t keep up with the Joneses. Friends don’t let friends go broke. Be honest with your friends about your situation. Instead of going out for expensive dinners or shopping parties, suggest a walk or have people over for tea. If your friends won’t adjust some of their plans to suit your new budget, you might want to reconsider the friendship.
  5. Start to track all of your expenditures. Begin tracking your spending using one of the online budgeting tools. Track everything you spend and yes, that includes that latte you just had. You will quickly be able to see where your money goes, and you can decide where you need to trim.

Believe it or not, a financial setback can be a blessing.

You will learn what is important to you, who your friends are, and how to take care of yourself financially. And one day, when this is all behind you, you will appreciate the little luxuries in life even more.

 


9 Comments

  • 1010ParkPlace July 5, 2016 at 7:37 am

    Great advice, Jen. After my first husband died, I found myself in a world of financial hurt and debt. It was a wakeup call to seize control of my entire destiny and never look back. It’s scary, involves ego and is not an easy thing to do, but I knew my very survival depended on it. Thanks for these tips! xoxox, Brenda

    • Jen Lawrence July 6, 2016 at 12:00 pm

      It is a scary thing isn’t it, Brenda. And such an insult after injury. It’s so important that women be in control of their finances and you are such a wonderful example of beauty from ashes. xo

  • Cathy Chester July 5, 2016 at 7:26 pm

    We’ve been living with financial setbacks ever since my husband was let go from him company while they were cutting back. We both work very, very hard – sometimes too hard – at the businesses we do. My illness costs a fortune to keep up as does a newer diagnosis of my son’s.

    We are trying to sell our home and the stress of money, or lack of it, is difficult. We don’t go away unless I can barter a hotel stay for a blog post; we don’t go out much.

    Fortunately our marriage is a strong one but I feel like life is passing us by. I love your advice but just once I’d love to do something for the sheer fun of it!

    Anyway, thanks for a wonderful post. You are so right on every point.

    • 1010ParkPlace July 6, 2016 at 7:59 am

      Cathy,
      Your post makes me realize we’re all at the point where we’re wondering if we’re financially prepared for the rest of our lives? It’s a scary feeling and in some ways, we do feel trapped. Like not going out much and bartering for time away. Instagram makes me feel like life is passing me by! OMG! I stumbled into a woman’s IG account and felt like the poor church mouse. One day she’s in Monaco, the next Paris, then skiing in Switzerland, off to the Bahamas… It just goes on and on, while I’m wondering do people really live like this? You’re not alone. xoxo, Brenda

    • Jen Lawrence July 6, 2016 at 12:04 pm

      Oh thank you, Cathy. Life can hand out some real lemons, can’t it. I’m glad your marriage is a strong one and you have each other for support. And good for you for making those hard decisions to relieve some financial stress. I’m a big believer that there are seasons in life and it is always darkest before the dawn. I wish you continued strength. xoxo

  • Esther Zimmer July 6, 2016 at 1:01 am

    Really sound advice here, Jen. When my first husband and I separated, I walked away with nothing and had to start over on my own. It was hard but it taught me that I’m capable of looking after myself. Fortunately we didn’t have kids. I constantly reminded myself that it was ‘just a chapter’, although it felt like a long one! Esther xx

    • Jen Lawrence July 6, 2016 at 12:06 pm

      Those chapters are long, aren’t they. I’m coming out of a dark decade and I can say that it has made me very appreciative for what I have. It sounds like you are in a similar place. xo

  • Susan July 6, 2016 at 1:01 pm

    Excellent adavice, Jen! As my husband and I get closer to retirement, we are cutting costs wherever possible. It feels great to unload debt and to de-clutter every area of our lives. Recently, we met with an estate attorney to get things in order to pass down to our children. It was a bit pricey, but well worth it knowing they will not be mad about a lack of planning when we’re gone!

    • Jen Lawrence July 6, 2016 at 7:32 pm

      Your kids are lucky that you are so on top of your finances. I’m a big fan of hiring experts in the field too. It’s so freeing to travel lighter, isn’t it. xo

    You Might Also Like

    MAKE LIFE COUNT.

    Sign up to our list and we’ll send you our sought-after guide “45 Ways To Change Your Life”
    I'm happy you've joined us! If you like what you read, I'd love for you to stay and subscribe to our updates by email. We have a great community of like-minded women, and your presence can only make it stronger.