How To Manage Finances During an Illness
A health problem may require you to do two things at once: follow your Doctor’s advice, and monitor your finances.
You can’t balance these two important tasks alone, and you need the help of other people, and a plan.
Contents
Always Have a Plan in Place
The first step is to prepare in advance.
Have a plan in place to create a monthly budget, to save for emergencies, and to invest.
If you’ve had a financial setback, this article can help.
With discipline and time, most people can accumulate far more wealth than they think is possible. But growing wealth requires change- which is precisely why most people don’t make the effort. The changes I’m suggesting involve an old friend:
Delayed gratification
Some decisions are relatively small:
- Dropping a subscription music service and just listening to the free version (Pandora, for example).
- Making coffee at home two days a week, which means that you stop by Starbucksless often.
- Buying afew more generic products when you go to the grocery store and Target. (I’m not going generic on salad dressing, however).
Since these are smaller decisions, the amount of gratification you’re delaying is small. You don’t mind listening the commercials on Pandora (I certainly don’t- I just turned down the sound), and the coffee at home isn’t bad.
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Other decisions are much bigger. StudySoup wrote this great article on the average amount of money a college student saves by having a roommate. The average savings over four years is over $15,000. Now, having a roommate is a big sacrifice, because you lose a fair amount of privacy. If privacy is really important to you, it’s a true delay of gratification (until you graduate, get a job and can afford to live alone).
So, what do I get?
OK- so what do I get out of all this delayed gratification?
You build wealth- which can give you peace of mind.
Here’s a practical example: By making changes to your spending and building a savings account, you create a $1,000 emergency fund. If your car brakes down, you can pay for the repair.
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Action Steps To Consider
- Create a budget, even if that budget is simply on notebook paper.
- Separate your expenses between fixed and variable, and take a hard look at your variable spending.
- Take steps to cut your variable expenses each month and put the amount you save into a separate savings account.
Create a safety net.
Reach Out to Friends and Family
Don’t go it alone.
One of the most common reasons that many people end up in financial trouble when their health suffers is that they are just too stubborn to ask for help.
We’re all taught that it’s important to be able to stand on our own two, but there’s nothing wrong with needing to ask the people closest to you for a help.
Seek help.
Talk to your creditors, and negotiate a longer time to pay your debts. Find people who can advocate on your behalf, such as your tax accountant and an attorney.
There are options to help you keep your finances in order when you’re sick, such as disability benefits. Companies like San Diego Disability Law Group can help you navigate the complicated process of claiming any money that you’re entitled to when suffering from a disability or any kind of chronic illness.
You Can Do It
With proper planning, and a group of people committed to help you, you can overcome financial problems during an illness. Make the effort, get through your health issue, and improve your finances.
Ken Boyd
Author: Cost Accounting for Dummies, Accounting All-In-One for Dummies, The CPA Exam for Dummies and 1,001 Accounting Questions for Dummies
(email) ken@stltest.net
(website and blog) https://www.accountingaccidentally.com/