Thursday, February 12, 2015

Dealing With A Major Financial/Life Setback

Lately, I have heard about a lot of folks who have suffered a financial and life setback.  This could be a bankruptcy from losing a job, losing a house after an expensive divorce, a major investment gone bad, or the loss of money or a pension in a bankruptcy (like Nortel).

The reactions of the people involved have ranged from attempted suicide to placid acceptance.  In looking at how they handled the situation, one thing came out clearly: those that accepted the situation and put together a new plan for the future were the happiest and came through the ordeal the best.  Those that dwelled upon the problems, did not accept the situation, complained, and tried to find an easy way out or refused to accept it did the worst.

If you have something financially unfortunate happen to you or a loved one, the best course of action in my opinion is:

  1. Stand back and analyze the situation.  What is the loss?  Is anything recoverable?  What is likely to happen in future.
  2. Talk to friends, family, and/or a financial counselor about the problems.  What do they think, is it as bad as you thought or worse? Can they help?   Express your feelings.  Listen to what they have to say.
  3. Reflect on the problem and try to accept the problem and its consequences.  This will take some time, it won't happen overnight.  You may need help with this.
  4. Put together a new financial and/or life plan that takes the problem into account and gives you and your family the best outcome possible. 
    1.  Learn to live on less?  
    2. Sell that extra car to get some needed cash?  Sell that "toy" that you never use?
    3. Move to a more affordable place?  Do you need 3 bedrooms if the kids have all moved out?
    4. Save more in future to make up some of the loss?
    5. Take your government retirement pension and learn to live on that money?
  5. Be happy with what you have and your state in life and your new plan.
The key thing seems to be getting to the point of accepting the loss and coming up with a new way forward, a new plan that makes the best of a bad situation.  If you or someone you know is in this situation, I hope this helps.

No comments:

Post a Comment

Comments are not moderated prior to posting. Mark