No one likes to think about the worst-case scenario, but it’s a necessary evil for survival. As life is unpredictable, something could happen anytime that changes everything. Whether the circumstances are short or long-term issues, it wreaks havoc on your well-being and finances. Although many people have a few bucks tucked away to handle unexpected occurrences like a home or car repair, they often forget about financial emergencies like these listed below.
Illness, Injury, or Disability
Many factors contribute to your health and wellness. Although you can take precautions to reduce your risk of getting sick or injured, sometimes it’s unavoidable. Something like the flu, a cold, or a pulled muscle can be relieved with over-the-counter medications and a few days off. However, are you prepared to deal with a serious illness, injury, or disability?
When your condition prevents you from working or completing everyday tasks and requires several weeks or months of recovery, it can significantly impact your finance. Once you’ve used your paid sick leave, you lose the stability of a paycheck to cover your expenses. Not to mention, you’ll also need money to cover your medical bills, prescriptions, surgeries, and aftercare needs.
How To Prepare: Every adult should have life and disability insurance to provide financial protection in their time of need. A disability policy can provide income to cover medical expenses and other obligations until you return to work. You can purchase a policy for just a few bucks a month and submit a claim whenever an emergency leaves you sick or injured.
Breakup, Divorce, or Loss
You love your partner and hope that you will be together forever. However, no one can predict the future. Relationships fall apart for various reasons, including death. While suffering a breakup, divorce, or loss is emotionally overwhelming, you must also understand the financial impact.
If you and your partner shared the bills and expenses, you now have one income instead of two. You’ll need to ensure you can sustain your lifestyle without causing financial strain. If your loved one passes away, you must also pay for the final arrangements and taxes and settle the estate.
How To Prepare: Compare your bills and expenses with your income (not your partner’s). If you cannot afford the bills, begin working on money management practices to reduce debt, boost savings, and increase your income. You and your partner should also invest in life insurance policies to cover final arrangements and other estate debts.
Natural Disasters And Pandemics
There was a time when preparing for natural disasters and pandemics was necessary for people who resided on the west coast, midwest, or international countries. However, as climate change intensifies, everyone has become a victim. No one wants to think about losing their home, having to relocate, sheltering in place, or wearing masks, but it’s a reality we know too well. Therefore, the best thing you can do is get prepared.
How To Prepare: Natural disasters and pandemics can strike at any moment. There are various things you can do to prepare. Stocking your home with canned goods, bottled water, and toilet paper is a great starting point.
You should also have essential household tools, first aid supplies, flashlights, batteries, and candles. Create an escape plan and meeting point in case you have to retreat from your home. You should also invest as much as possible into an emergency fund in case of mass unemployment.
If only life could go according to plan. Unfortunately, that’s not reality. Life is full of twists and turns that can change the course of your future. Unexpected events can cause significant physical and emotional harm that takes years to overcome. All you can do is ensure you’re in the best possible position to handle those unforeseen occurrences and weather the storm. Don’t let circumstances like sickness, divorce, or natural disasters catch you off guard. Use the suggestions above to prepare for the worst-case scenario so you can get back to enjoying it right now.
