We all know that life can take unexpected turns, but this doesn’t always help when things don’t quite go to plan. There are all kinds of eventualities and incidents that can knock us for six, and usually, things happen when you least expect them. When managing your finances, it’s always useful to bear this in mind and to try and ensure you have a backup plan, just in case. Here are some tips to help you keep your finances in order if life takes a turn.
Set up an emergency fund
We don’t know what’s going to happen tomorrow, let alone in five or ten years’ time. You may never need an emergency fund, but it’s so useful to have access to a pot of money if you ever find yourself in a situation where you need extra cash fast, or you don’t have a steady income. You could use your emergency fund to pay for everything from urgent storm damage and car repairs to medical treatment. If you lose your job, or you can’t work for a period of time, your savings could also provide a nest-egg. If you don’t already have an emergency account, set up a direct debit, and transfer what you can every month.
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Make sure you’re insured
Insurance is a form of protection, which offers financial benefits when things don’t quite pan out as you hoped or expected. If you have a car crash, you need a medical procedure, or your house is burgled, for example, you can claim on your insurance. Before you make a claim, read the details of your policy very carefully, and take your time when filling out the application. Not all claims are approved. Sometimes, there’s a genuine reason, but in other cases, there’s a dispute between the policyholder and the insurance provider. If you’re claiming for a disability, for example, and your claim is rejected, it’s wise to talk to disability insurance lawyers. If your case has been turned down unfairly, your legal team will do everything possible to ensure you get the payout you are due.
If money is tight, it’s incredibly beneficial to make a monthly budget. This will help you to monitor your spending, make the most of your income, and prevent you from getting into debt. You can use apps or computer programs, or jot down figures on a notepad. All you need to do is write down every payment you expect to come into your account, and every outgoing expense. Once you’ve got the numbers in front of you, it’s possible to determine how much disposable income you have and work out how best to manage your money.
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You may have your finances in order at the moment, but would you be able to stay afloat if your life took an unexpected turn? Many of us focus on the present, but it’s also hugely beneficial to think about the future and try and ensure you have a plan B, just in case your situation changes at short notice.