Five things to do when you’re facing change or a crisis

I am writing this article in the midst of the coronavirus pandemic.  But, I could be writing this in light of a recent layoff or huge expense or a big medical expense, or another kind of financial crisis as well.  Unfortunately, crises happen.  Fortunately, there are things we can do to make them less stressful and easier to navigate.  Hard times come.  It’s not a matter of if, but when.  So, it’s vital that we prepare so that when a hard thing happens, we will have financial peace of mind.  Here are my favorite tips on how to be prepared for any hard time that comes our way.

1-Keep paying your tithing/donations, and/or find other ways to give.  This is going to help you in so many ways.  Giving helps you keep a mindset of abundance and gratitude.  It allows you to give to others who are in a worse situation than you.  There will always be someone who is in a worse situation than you.  When we give, we create a mindset shift for ourselves that allows us to move into abundant thinking, gratitude, and a bigger picture.  It helps put things in a bigger perspective and better proportion.  When we give we always enlarge our capacity to receive.  I like to compare mindset to a fist or open palm.  If we are hanging on to our money so tightly so that it can’t leave, our fist is so tight that it also can’t allow us to receive.  However, if our palm is open and we are allowing money to leave, we are also allowing money to come.  We create an abundant flow.  Money is only energy and when we are able to give, even if it’s only a little bit, good things will always come of it.  Call it karma or divine intervention, or whatever verbiage you would like to use.  But good things always come when we’re willing to give.  I know that blessings WILL come because we give, and they may come in unexpected ways.  Crisis time is not a time to stop giving.  You may have to reduce, or only give a little, but keep finding a way to give.

2-Don’t panic.  When we are in crises mode, it’s easy to panic.  In fact, it’s instinctive to panic.  However, when we make decisions based on fear, the decisions are rarely good.  Fear puts us into scarcity mindset.  Fear cuts off creativity, optimism, and rational thinking.  One of the best ways to combat fear and panic is to have a plan and to take action.  The best time to make a plan is when you are not in crisis mode.  The second-best time to make a plan is now.  What will you do if your income stops?  What will you do if you have to live off of your reserves?  What will you do if you are not healthy and cannot work?  If we are prepared both mentally and financially, we won’t have to fear.  And even that initial fear and panic strike (which is natural and normal) we will know that we already have a plan in place.  A few months ago, when I found out our main source of income was going to stop, I let myself panic for a few minutes.  And then I buckled down and made a plan to take action.  I listed all of our bills and their due dates and put them in order of most important (hint: food, shelter and transportation should be at the top of that list).  I wrote down all of our current assets and liabilities.  I took inventory of our cash reserves, as well as our food storage.  I was able to see where we are financially weak and where we are strong. Not only did it give my brain something else to think about, but having a plan helps us to be calm.  Our brain likes to solve problems.  If we can make a plan, our brain feels better because it knows we have something that we can control.  If you focus on action we have less brain power to fear or panic and we have a greater sense of control over the situation.

3-Have a reserve.  This has got to happen before a crisis comes.  A reserve of money will bring so much peace of mind.  The traditional three to six months emergency fund is an essential aspect of financial wellness, but that amount of money can seem overwhelming.  Having just one-month worth of expenses in a savings account can bring immeasurable peace.  By having one-month worth of expenses saved will give you the opportunity to have time to assess the crisis situation and think rationally about options.  It will buy you time (no pun intended!) to create a new plan and determine how to move forward.  While six months worth of expenses are ideal, even having one month will bring peace and the ability to regroup and make a new plan.  If you don’t have reserves saved up, make a plan to take action today!  Save even just a small amount on every income you receive.  It may seem slow, but it will add up!

4-Another financial aspect to focus on when faced with a crisis or any sort of change, really is to find ways to protect or increase your cash flow.  What is cash flow exactly?  It is simply what you have left over after you’ve paid all of your expenses.  Income minus Expenses equals Cash Flow.  Cash flow really is the key to financial wellness.  The higher your cash flow, the better ability you have to build your savings, pay off debt, meet your financial goals, and invest so that your money can multiply.  Cash flow is magical.  When a crisis happens, usually it is our cash flow that takes the hit, either because our income has been stopped or reduced or our expenses have grown.  When determining your course of action, I encourage you to think in terms of cash flow.  Will the decisions you make increase your cash flow or decrease it?  Improving cash flow comes down to finding ways to decrease your expenses, finding ways to increase your income, finding ways of turning liabilities into assets, and adding multiple streams of income.  When in crisis mode, cash flow should be your focus.  One example: refinancing your car loan that you’ve paid down a bit into a longer term loan.  This may seem counterintuitive because it will increase the amount of interest you will pay over the life of the loan.  But, if it increases cash flow in the immediate future it may be a good move until you are back on your feet again and can get back to paying off the loan faster.

5-Tip number five should really be tip number one.  In hard times, as well as good times, seek Heaven’s guidance.  God is the giver of good gifts.  All that you have is because of Him.  He wants you to be happy, He wants you to be successful.  He wants you to be a good steward of your resources.  He wants to bless you, guide you and comfort you.  When you present your problems to Him, ask in faith and be willing to act upon what He tells you.  He will teach you and show you the way.  You are His daughter and He will not abandon you.  He cares about all aspects of your life, including your money.  He is the Master Teacher and will teach you or lead you to someone who can.  Include Him in your plans.  Ask for His help.  Show Him your goals and seek His approval.  With Him all things are possible. 

Remember that crises does pass.  Use the experience to learn what you can about how you can be even better prepared next time.  God will help you.