Life is rarely as straightforward as we imagine. Often, events come along that throw all our plans off course. This is especially true when it comes to our personal finances. We do all the right things, save up and plan for the future. And yet, life somehow manages to throw us a curveball just when we least expect it. Here are some of the life events that can wreck your finances and what to do about them.
Unexpected Health Expenditures
Right now, health costs are rising fast, especially for seniors. And that means that many families are feeling the strain of increasing medical expenses. Known health expenditures are usually manageable and can be budgeted for. But many health issues can crop up and suddenly wreck your finances.
Again, what can you do? One option is to use a service like Medicare. Medicare might not be the best medical solution, but it’s a source of affordable coverage for many people. Medicare can be great for things like physical injury or getting access to antibiotics. And so if you’re relatively young, this could still be a good choice.
Of course, most people don’t need the medical system because they’ve been injured or have got a bug. Most people need it because of some type of chronic illness. What many people don’t realize, however, is that many chronic diseases are the result of lifestyle choices. While that may be sobering news, it’s also an opportunity. It means that you can change your lifestyle and reduce the chances that you’ll have to shell out on medical costs. What can you do? The Society Of Actuaries says that it’s a good idea to start eating healthily. That means increasing the amount of fruit, veg, and whole grains. And they also suggest people, especially if they’re older, use as much preventive care as they can, like going for a cancer screening. Essentially, when it comes to medicine, it’s best to do everything you can to avoid the system. If you get entangled in it, it can wreck your finances in a matter of months.
Accidents At Work
Accidents at work are very common. The Bureau of Labour Statistics estimates that there are 3 million nonfatal injuries in the workplace every year. And these are just the injuries reported by private employers, so there are probably much more. Although injuries are declining, thanks mainly to improved health and safety, they’re still a big problem in the US.
Accidents are very costly for the people involved. They’re expensive for the employer because they lose a productive member of the team. And they’re especially costly for an individual, like you. People who have been injured stand to lose months of wages while they can’t work. And this can play havoc with their finances.
So what should people do? First off they should find some advice from legal professionals on sites like mbpersonalinjurylaw.com. There’s not a massive injury dedicated to getting workers compensation from workplace accidents. Many workers have received compensation in the millions of dollars. So the courts are, in general, keen to make sure that workers get adequate compensation.
Of course, it would be better if injuries didn’t happen in the first place. If your employer is doing something that is unsafe, raise your concerns with management. This way, they have been notified of a problem, and it’s their responsibility to sort it out. You also want to make sure that any employer you work for has a comprehensive health and safety procedure. If they don’t, it might be best to find another place to work.
Auto crashes are, by definition, unexpected. They’re also expensive to clean up. First, you have to pay your insurance company a large excess, even if it wasn’t your fault. And then you have to pay medical expenses while not getting paid from work.
Each year in the US, there are some 30,000 fatalities from auto collisions and more than a million people injured. This makes cars dangerous, and one of the most likely things to wreck your finances. So what can be done about it?
First off, you can choose a really safe car. Sites like http://www.iihs.org/ list cars by their category and safety rating. Safe small cars include, surprisingly, cars like the Mini Cooper and the Scion iA. But the safest cars tend to be some of the largest. The Volvo XC90 is a good example.
Secondly, you can also file for a personal injury claim from your insurer to cover the costs of being off work. Many people suffer a period of injury after being involved in a car accident that prevents them from earning. But it’s now easier than ever to make a claim.
Perhaps top of the list of most people’s list of things that ruin finances is divorce. Divorce settlements can run into the hundreds of thousands of dollars and cost people their homes. Often it’s the case that both parties suffer enormously. After all, finances are often what keeps people who aren’t happy with each other together.
But divorces don’t just have an effect over the short term. They also make life difficult over the long term too. Divorce can alter retirement benefits, for example. And paying child support can reduce your disposable income over the very long term.
In general, divorce also leads to a much lower standard of living. Couples can no longer pool resources. And as a result, each person has to pay for their own rent and utilities.
So what to do about it? Well, if you’re not already married, you can write a prenuptial agreement. Prenuptial agreements spell out exactly who has a claim to what if there should ever be a divorce. Prenuptials are a tricky business. It’s kind of admitting you don’t trust the other person. But being straightforward and honest can actually help to strengthen a relationship.
You can also go through something called a post-nuptial agreement. These are a way to mediate who should have access to what property after the fact.