There are few things as exciting as a life changing event. A new baby, a new job, moving to a new home. These are things that people look forward to, and with good reason. The problem is that these events often put you in financial problems for a short period of time because no matter how well you prepare yourself, there is almost always some kind of unexpected expense that you are going to need to cover. With proper planning, and by understanding your options, you can make the transition a little easier and enjoy your new changes.
Start Saving Now
The most important thing that you need to do is start saving before you even reach the point where the event is imminent. It is always good to try and have a couple of months’ worth of money in savings to cover unexpected expenses, but that is not something that every family can afford to do. Even a small nest egg of a couple hundred dollars can do wonders to ease the transition from one phase of your life to the next. Say that you get a new job that is a step up from your previous position. This will often require a change to your wardrobe so that you can dress more professionally. With a small nest egg you can get a few key pieces so that you will be able to tide yourself over until you can afford to get better clothing for your new position. The same thing goes for paying deposits and picking up the odds and ends that will make your new home feel like a real home.
Write Out Contingences
List making is a very underrated tool for planning your future. When you take the time to write out the things that you think might come up, you force yourself to look at a situation from a variety of different angles and decide how you will approach those situations if they occur. You never want to be blindsided by something that you did not consider might be a problem, because that is where you will run in to the most difficulty. If you got a new job, is the commute going to cost you a significant amount more in gas and vehicle maintenance? Are your utilities going to be much higher in your new home because it is larger than the old one? Do you have money ready in case your newborn gets sick in the middle of the night? Always think ahead and try to anticipate problems, and you will have much firmer financial footing.
Have A Plan For Financial Issues
If you do have a problem come up, you need to have a plan in place to deal with it, especially if your savings are not going to be enough to cover the problem. Credit cards have been the fall back option for a lot of people for a very long time, but the interest rates on credit cards make them a very poor choice in most situations. A bank loan can help tide you over for a period of time, but you need to have decent credit to get one, and the bank may require you to take out a loan for much more than you really need just to meet the minimum loan requirements. Short term cash loans, like pay day or title loans, are usually a good fit if you only need a short-term cash infusion that you can afford to repay very quickly. While this is not a good long-term solution, cash loans can get you what you need in an emergency.
A life changing event is something that can be planned for and you should make plans for these events before they happen to you. When you have a plan in place, and you understand what problems you might be facing, you can keep yourself financially sound and take pleasure in the new changes to your life.