Handling Life’s Big Financial Changes

We all know that life is full of changes — changes which usually affect our money as well. There are things like getting our first job, moving out on our own for the first time, getting married, having kids, changing jobs, dealing with divorce or illness, losing jobs, making major purchases, etc.

So when changes come your way that impact your finances, how do you handle them?

For me, I stick with the “hope for the best and prepare for the worst” motto. I believe that the more prepared we are for changes, the better. (Although it’s pretty difficult to ever be 100% prepared for anything.)

Of course, there are plenty of involuntary changes that we can’t expect. People don’t set out aiming to lose their job, get divorced, or become ill. But we can be certain that something unexpected will happen during our lifetime. If it’s a negative change, we can plan for the unexpected by using insurance and emergency funds to help deal with it.

But what about big changes that we do plan for, like buying a new house or quitting the 9 to 5? I once quit my job to go work in Germany for a few months. I remember getting off the plane and wondering what the heck I had done. It turned out fine, but for me at least, the overwhelming reality of a change often doesn’t hit until it’s too late.

And I think that’s normal. You can’t really know what life will be like until you live it. The keys to handling life’s big financial changes are to have contingency plans, imagine how you might handle worst-case scenarios, weigh your options carefully, and be as realistic as possible.


  • Hubby calls me a worry-wart because I’m constantly figuring out how we’d handle x. I’m a naturally optimistic person, but I also love having backup plans. :-)

  • Love this sentence: “You can’t really know what life will be like until you live it.”

  • I am really good at handling financial change to the upside… :)

    I have been a working mom, a stay at home mom, etc. My husband has changed jobs a few times, for the better and we have been very lucky. I always carefully plan for our financial needs based on income. For instance, my husband was vacillating between leaving his job at the time and a new opportunity. I flat out told him that financially, he pretty much had to choose one job over the other, and that made his decision much easier.

    So, over the years our income has gone up and down. We have been lucky in that we were in the driver’s seat for these changes, and based our decisions on the circumstances at the time. Right now we are down to one income though, and we are definitely adjusting our spending accordingly.

  • I don’t have dental insurance, but I *do* have a sister who’s a dental hygienist and will clean my teeth. (Her boss even lets her do X-rays.)
    So the good news is that I got my teeth cleaned for free today.
    The bad news is that she pointed where I will eventually need a new crown due to cracks in the tooth. The cost: About $1,200. She couldn’t say how long it will last in its current condition. Maybe years. Maybe not.
    I could wait until it collapses. Or I could do the grown-up thing and get it fixed when I come back from my house-sitting gig in Alaska. I’ll ask if they offer a discount for cash; if they don’t, I’ll look at it as 1,200 more frequent flier miles — and pay the bill in full when it arrives, even if it means skimming the emergency fund.
    Sometimes it stinks being a grownup.

    • Owie on the crown. My husband had to get one of those recently and it ran about $900. Still, it’s better than waiting until you need a root canal.

  • My biggest financial disaster was getting divorced. Unfortunately I was married to a spender and we had no emergency fund.

    I did work through it and my husband of 15 years is a saver. It’s a much more secure life.