During this uncertain and difficult time, and as we fact a lot of unknowns, I wanted to reach out and discuss the concept of Financial Resilience.
Resilience is defined as “the capacity to recover quickly from difficulties and toughness.” When we observe the impact of COVID-19, whether it’s learning new terms (social distancing, flattening of the curve, or self-quarantine) or facing our loved ones getting sick, or finding empty shelves at the grocery story, we know these are unprecedented times.
COVID-19 pandemic has gripped the world and has already caused major impacts to peoples’ lives and will continue to do so as the days unfold.
When disaster strikes, resiliency seems to come naturally to some, while others must cultivate it. When we examine our own lives, and the lives of others, we can find examples of personal growth that has come from working through difficult situations and from being resilient.
A friend of mine told me yesterday that the thought of staying home with his kids for a prolonged period scared him. He mentioned that he thought he should be working on his business and figuring out how to keep revenues coming into it. After only one day of being with his kids, he changed his perspective and outlook. He is now saying that this next month or so will be a special time as he has never had the opportunity to spend so much time with his kids. He has altered his day to allow some time to focus on the essentials of his business, but is mainly focusing on his family.
A resilient mind is one that still maintains a clear view of the situation, one that sees it for what it is, but can also reframe to pull out the positives. It’s not dismissing the magnitude or fooling ourselves, which is dangerous to do, but it is finding the ways in which you can make do, survive, and even, in some cases, thrive.
What is financial resilience?
Financial resilience is the ability to absorb or withstand life events that create a financial shock. For instance, job loss, illness, a major unexpected expense, and, as we are seeing right now, a global virus. Why does it matter right now? Our financial health has an incredible impact on our overall well-being.
What does this mean for us?
It is only natural for us to be feeling stress or uncertainty around our financial health during these times. And while our finances may not be the very first thing on our mind, when we are faced with so many unknowns and stressors, they certainly arise.
But, through resilience—through reframing even the most difficult situations—and realizing these times can offer us the greatest lessons, we have the ability to learn and to prepare for the future. This preparedness builds resilience.
I want to focus on things that we can do TODAY to help us manage our financial health through these uncertain times.
- Talk out loud. Express all your financial worries with others.
- One of the biggest ways to deal with adversity is by talking to others
- Research has shown the mere act of talking through our worries helps build resiliency
- Grab your trusted friend, family member, or your financial advisor and talk with them
2. Focus on things you can control.
- Too often our minds focus on things that we can’t control. Rather, if we focus on things we can control, we will likely find ourselves spending less time worrying and more time taking important action.
- Worrying about the fallen stock market does not help our financial well-being.
- We can’t control the falling stock market. But remember, over the past 100 years, we have seen several times when the market has dramatically fallen. And, it has always recovered and even produced positive results in the years that followed.
- If you are concerned about your expenses, look through all your expenses and determine which ones you can cut out indefinitely and which you can postpone.
- If you are in financial trouble, call your mortgage company and see if you can skip a payment or two. Call your other loans and ask the same question. Often you will be surprised by the answer.
3. Ask for help from others.
- Sometimes we are afraid to talk with others as we don’t want to sound weak or stressed.
- Often other people are feeling the exact same way. Reach out to others, you both may need it.
- If you are feeling overwhelmed with your finances or expenses, reach out to someone such as your parents, friends or any other person you trust.
- Help might come from a conversation or potentially through financial support.
4. Continue to practice healthy habits.
- Resiliency is positively influenced from a calm and collected mind.
- Continue incorporating exercise, eating well and maintaining a “normal” schedule.
Focus on building resiliency no matter the circumstance. Keep calm, carry on. Wash your hands. Be kind to the vulnerable, and together let’s flatten that curve.