Avoiding Financial Disaster; Financial Planning

Have you ever had a moment hit you so hard you knew you would remember it for years to come?

I had a moment like this a few days ago that made me re evaluate my financial future. It was a normal weekday here on the HK Bar. I was cooking breakfast, the kids were running around, and my husband sat at the kitchen table talking to me as I cooked. He was just home from his first job that he works from about 3 a.m. till about 9 a.m. and he was telling me he ran into someone we both knew. (We will call him Rick for anonymity). He said Rick has battled cancer three times in the past year. Rick was forced to sell his lucrative business, deplete his life savings, and sell his farm and almost all of his assets to pay his medical bills and living expenses. He had no insurance. He had no plan. And now he has no plan and no money, and a pile of debt. He is over fifty years old and is starting over at an entry level job for another company. He made the impressionable comment to my husband,

“I never saw my life turning out this way. I never even saw it coming.”

It is this statement alone that sucked the air from my lungs and made me re evaluate my own financial position.

I don’t want to be blind sided like Rick. I want to have a plan. Of course life is always uncertain, but why not try and cushion the blow a bit?

Anyone that knows me well, knows I mean serious business about my finances. We aren’t a family that is well off. My husband works three jobs usually, I work part time and also run our household and do jobs on the side when I am able. We don’t have brand new fancy things, but what we do have is payed for, well taken care of, and within our means financially.

Here are a few things I considered for my own financial future.

1. Save. Start saving, keep saving, and stick to your goals. Even if you only save a dollar a week, you are saving. Something is always better than nothing!

2. Know your retirement needs. According to the U.S. department of labor you will need at least 70% of your pre retirement income to maintain your current standard of living.

3. 401 K. If your work offers it. Sign up! Alot of times companies will have incentives that they will match what you put in up to a certain percentage. (That’s free money folks!) Its also automatically deducted, so less effort and its done. Compound interest and tax deferrals make a big difference in the amount you save!

4. Have health insurance. You never know when some major medical incident will happen. A car accident, a stroke, cancer. Anything major medical equates to big bucks.

5. Avoid debt. Don’t need it? Don’t buy it. Simple.

6. Emergency fund.  No matter what your income you should always have an emergency cash fund. Something you can get to easily. For those occasions like the car breaks down, furnace goes out, etc.

Of course I am no financial expert, but these are all things I put into perspective. I hope they help someone out there avoid a financial disaster. Or even just inspire thought about thier own financial situation and future.

7 thoughts on “Avoiding Financial Disaster; Financial Planning

  1. OOOHHH!! I love the debt one! It seems like everyone around me is in debt while I try to stay out and sometimes it’s hard. 😦 But danke for the encouragement!!! And the emergency fund is a very good idea too. So many people simply say ‘not today, not today’ all their way to the hospital. *rolls eye* crazy people. 😀 Good post!!!

    Liked by 2 people

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