We’ve all heard the news of layoffs across multi sectors and you begin to feel fear that maybe your industry is next. That’s human and completely understandable but what if you used this time to prepare for the worse, while hoping for the best??? 

Back in 2012, I was on a road trip driving from one US state to another and listening to the radio. While flipping from station to station I heard someone say, “what if you bought your next car outright, for cash”? The next statement sounded even more insane, “what if you paid cash for your next home”?

I immediately thought, that’s nuts, who can do that but let’s go back to that car question! I continued listening as I recognised the voice, it was Joyce Meyer, but to be honest, I really didn’t hear anything else she said after those two questions. 

“What if you bought your next car outright, for cash” I rolled that question over and over in my head for the balance of my road trip.

I’ve never even thought about that being a possibility. I was actually driving around in my brand-new financed Jeep Sahara. Who can afford to pay for a car outright? For some reason, that was never even a consideration, but that question turned my whole financial life upside down.

I knew our finances were a house of cards even though we were able to make all the monthly payments. However, if one or both of us were to be laid off and lose our normal, steady income, we were toast! As a Gen-Xer, we are naturally resourceful and practical – so I thought, “we’ve got to fix this mess”!

We jointly decided to act as if my partner had lost his job and we would live off of my income. We would use his income exclusively for debt repayment. It sounded good when we agreed to this new way of living but dear Lord, I really hadn’t thought through how dependent we were on two incomes! 

That first pay period was a rude awakening. We couldn’t go out to eat, we couldn’t fill my Jeep up – what the hell have I done???? I know, I’ll just use my credit card. That will help us make it to my next paycheck. I begin to calm down and think, “we’ve got this”!

My fear had subsided, so I decided to watch TV. I was flipping through our 50 cable tv stations and I flipped to this station where this guy said, “if you are in a hole, quit digging”! What is he talking about… so I put the remote down and watched him, but his intensity was palpable. Turns out it was Dave Ramsey talking about his “Baby Steps”. At the end of his talk, my stomach churned. My solution to making it to the next pay period was “digging a deeper hole”; we didn’t even have an emergency fund. Apparently using credit cards was not an emergency fund :(. It was worse than we thought!

We decided to sell everything to get that $1,000 in emergency funds. It took about a month, but we had done it, we actually had a REAL emergency fund. During the month, we decided to list our debts from smallest to highest and use the avalanche method. Let’s be honest, if we were financial savvy, we wouldn’t have $414,000 in debt. So, looking at a repayment plan based on descending interest rate was just more insanity. We needed wins and we needed them quickly.

I had to learn that a sale at that mall was not an emergency. I had to learn that buying food that was on sale was cheaper than buying what we really wanted to eat. We had to learn that our community had free entertainment. I had to learn that our local library had books that we could borrow instead of buying them on amazon.com. We had to learn that we couldn’t participate in Taco Tuesday (that one hurt). We had to learn that we could live without cable. And dear Lord, I had to learn that I couldn’t afford my new Jeep! 

It took 7 years of living out of one income to pay off $414,000 in debt and yes, that’s a freaking long time! But I can’t tell you how good it feels to sit here now. I don’t have to make decisions based on my debt.

I know this all sounds drastic and it was. You are probably thinking, “you don’t know my situation” and you would be right, I don’t. BUT you do.  

Maybe you are living off of credit cards as your emergency fund? Maybe you are living in a home you really can’t afford? Maybe you have nothing saved for retirement? Maybe you don’t have a REAL emergency fund? Only you have the power to change your situation. Why not act as if life has thrown you a curve ball? Why don’t you get prepared now? We all believe in having insurance, think about this as your FINANCIAL LIFE insurance?

Why not use this time to do something you have never done, to get something you have never had. Why not do something now, before something or some company makes the decision for you? 

Trust me, it’s going to rain one day. Maybe you will not get laid off, but something will test how strong your financial house of cards is… shouldn’t you be prepared for the storm?

Thanks for reading and remember, our story is far from over, let’s keep Enjoying the Journey!