I’m in the same boat. Although I’ve gone a long way in the last two and a half years towards relieving my financial worries, I still have a lot of my own concerns. What would happen if I were to pass away suddenly? What if my wife were to pass away?
Most people bury these concerns by simply not consciously thinking about them. They hide those concerns deep under the surface and live life pretending such things can never happen. Under the surface, though, they build up worry and concern, things which burst out when a bump on the road happens.
I’ve seen it myself, both in my early adult life and in the people I know around me. Everything is fine for a while until suddenly you need $1,500 for a truck repair - and then panic sets in. There’s no money to pay for it. My financial low point, for example, occurred when I pulled a pile of bills out of my mailbox and realized that I simply didn’t have the cash to pay them.
What I soon discovered after that was the best way to soothe a financial worry is to have a plan in place to deal with that worry. But how can you do that rationally?
For me, it wasn’t simply that easy. It took me quite a bit of fishing around in the dark before I began to figure out how to fix my financial concerns. What I eventually realized is that the quicker you begin to take steps - both general and specific - towards laying your worries to rest, the quicker it is that your mind can begin to be at ease and you can begin to focus your mental energies towards other areas - like getting ahead in your career.
Here’s how I’d tackle things if I had to start all over again.
First, have a very healthy emergency fund to deal with any bumps in the road without any worries. Each and every week, I automatically transfer some money out of my checking account into a savings account that I keep for emergencies. Then, whenever an emergency does happen, I have some cash saved up to take care of it. If you start saving $50 a week, it only takes a few months to have an emergency fund with $1,000 in it - and that’ll take care of a lot of hiccups.
At the same time, don’t get tempted to spend that emergency fund on something unnecessary. When you do have some cash built up, it’s quite tempting to just go grab it and buy yourself something fun as a “reward” for your hard work in saving it. Don’t - that just undoes all of the hard work you put in, and normal human luck dictates that the second you do it, you’ll find yourself regretting it as an emergency pops up.
Next, make a list of the things that worry you. What are those things that keep you up at night and cross your mind when you’re driving home from work? Those nightmarish scenarios that you hope never happen? Instead of just shuddering and packing them away, write them down. Make a list of the things that are actually bothering you and get them out in the open where they can be addressed (and likely fixed) with a little bit of focused concentration.
I’ve been lucky enough to take care of a lot of my worries over the last two years, but even today I still have a few. My biggest one revolves around the long term stability of my work - what can I do to keep my writing career stable over the long haul?
For each problem you write down, investigate a solution for it. Perhaps the solution is as simple as making out a will and having it notarized, or simply deciding what will happen to your children should you pass away unexpectedly. That relieved some significant concerns for us, actually. Perhaps you’re worried about your career - and it might be that the best path is to start being proactive about looking for another job, or start casting about for a new career entirely.
Come up with things you can do to take control of those fears. Some solutions will seem easy. Others will seem painful - likely revolving around a conversation you don’t really want to have. Yet others will seem very difficult or even impossible.
Take care of the easy ones immediately. Get that will drafted. Look into life insurance and get that policy set up so your kids aren’t left out to dry if you should pass away.
For the painful ones, ask for support from trusted people. If you think it’s time to talk to your parents about their future plans and how they’re managing things, consult your siblings or some trusted family friends. Take it slowly and gently, a piece at a time. Make an appointment - set aside time specifically to handle such things. You’ll be glad you did when it’s over.
And what about the big, difficult ones, like helping your children pay for college? Break things down into the smallest pieces you can. For example, can you simply put $5 away a day? Do it entirely in cash for a while until you get the hang of it. When you start being able to save that $5 a day quite easily, make it automatic - have a $150 a month transfer into a college savings account.
In the end, taking the time now to address those worries will pay huge dividends. Not only will that worry be addressed by your own actions, but you won’t have to expend mental or emotional energy worrying about this stuff any more. Instead, you can use that energy to build a better career, be a better parent, and succeed in whatever avenues of life you choose.
Tonight, go home and start addressing whatever problem is eating you up inside. What do you need to do to make that worry go away? Then (if you can), take that action and start making a positive change. That first step makes all the difference.
The Simple Dollar chronicles a man's road to recovery from "total financial meltdown." As author Trent Hamm puts it, "The Simple Dollar is a blog for those of us who need both cents and sense: people fighting debt and bad spending habits while building a financially secure future and still affording a latte or two." We'll post a couple of entries a week, but you can check out his writing daily at www.thesimpledollar.com