Everyone must perform a personal evaluation and ask difficult questions of themselves. We often fail to do so because we are afraid of the answers. But if we face them rather than avoid them, we can use them as motivation to make changes for the better. Here are some hard financial questions that everyone needs to ask of themselves.
What is the most catastrophic thing that could happen to your money?
Loss of job? Lack of funding for college for children? No money for retirement? Major medical bills that wipe out your savings?
What are the solutions? Have a plan for each one.
As for the job question, the answer might be to improve yourself and get training at the job you have right now. A highly trained and skilled worker has an edge over those who are not. The more skills and abilities you can offer an existing or potential employer the better off you will be in replacing a job. Make sure that your skills are diverse in order to be able to fit into different jobs.
College expenses have a wide range depending on where you want to attend. If your child chooses a well-known university, you will pay higher costs than those lesser known, but equally as good colleges. Use the student loans that are offered to students, and then make the payments for them if possible after they graduate. Or at least offer to pay half with them.
No money for retirement means that you will have to work longer past what would normally be retirement age if you are physically able. The other option is to live with family.
When major medical bills threaten to wipe out your savings, the thing you need to do is to try to preserve your retirement money. And the other thing to do is to try to work out a payment program with the medical providers. A judge would never throw the book at someone who is making payments or can show good faith efforts to work to pay off the debt
The key thing to remember is to ask these questions and then formulate a plan to help deal with the circumstances should they arise. At least you will not be fretting about how you are going to do that, it will have already been taken care of and you can put the plan into action.
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