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Times of tragedy and loss can, unfortunately, set up a family for financial ruin. Thankfully, there are ways to try to prevent financial ruin before it happens!
No one wants to talk about it, but the truth is that many families are just one job loss, one illness, and one tragedy away from financial ruin.
When we aren’t prepared for economic emergencies, it’s not only we who suffer–it’s our families as well.
The good news is that there are real, tangible ways to prepare now to prevent financial ruin during a loss.
Check out the following four.
4 Ways to Prevent Financial Ruin During a Loss
1. Set up an emergency fund.
While this won’t be enough to cover expenses during a major loss, most financial experts recommend starting out with an emergency fund of $1,000 and building on it until you reach six to eighteen months of living expenses.
The idea is to replenish the $1,000 as soon as you use it and to continue to stock away money for emergency situations.
Having an emergency fund will take away so much stress because you know there is always some money stored away in the event of a loss.
2. Accept help.
It seems ingrained in our American culture: We don’t like asking for help.
But especially during times of loss, we need our communities to step in and help take away the very real burden of grief and financial hardship.
Whether it’s accepting meals or gift cards for restaurants so you don’t have to cook or pay for groceries, or financial help through a fundraising site like ALittleHelp, accepting help during times of loss can help us prevent financial ruin during a loss.
3. Secure good insurance.
While I know not everyone can afford it, securing solid health and life insurance should be a financial goal as soon as you have the finances to do so.
An affordable alternative to health insurance is a health share plan, which is something my family is currently exploring.
One illness or tragedy can set a family back for years. The best way to prevent medical and loss debt is to secure solid health and life insurance before a loss happens.
Many who pass leave huge medical bills behind. And life insurance policies pay for more than funeral and memorial expenses. They also for mortgages, food and necessities for families left behind, and educational needs for children of those who have passed away.
Tim
This brings much to the surface for me , in 1999 , When my wife and I bought our home , it was truly a Godsend . We were able to come up with a down payment even get an offer for owner financing for our 15 year loan . We took money from our 401k . Then , 2 months later I was diagnosed with Leukemia . We had taken a little extra for some improvements to the house . We ended up using that money to pay for a portion of my treatments . We were so not prepared for this to happen ! But then again we were very blessed . I was in remission , then it returned in a different manner . Polycythemia Vera . now it has moved on to Mylelofibrosis. But we are still not as bad off as some who encounter these things . Erin , your articles and posts are very inspiring and enlightening . thanks !
Aimee Hadden
Good thoughts. As much as we do not even like to think about it, we decided to have small insurance policies on our children because the last thing we need to do in the event of a loss is have to think about money.