How to Survive an Income Crisis

As I read how a grateful family and community welcomed home 8-year-old Leia Carrico, and her 5-year-old sister Caroline, who’d been missing for two days in the Northern California wilderness, I was moved to tears. The bravery of these adorable girls and their stunning ability to move quickly into survival mode holds so many lessons for every one of us.

A woman walking down a dirt road

Leia and Caroline were focused like a laser beam on their ” right now,” not worrying or even thinking about the future—all of the “might happens” or “what ifs.” Oh, what a valuable lesson we can learn from these children.

Could you live through such a crisis? How about an income disaster? If you get the infamous pink slip tomorrow, will you know what to do? If you have it already, take a deep breath and let’s walk through a few basic strategies.

Don’t panic

It is essential that you keep your head and your cool, as demonstrated so aptly by young Leia who told reporters, “We needed to find shelter fast!”

The first few minutes, minutes or hours of any crisis are critical. If you lose it now, you will waste precious energy. At the moment of impact, take a huge deep breath and stay calm. While a job loss can be a devasting shock, it is not life-threatening. There is a way out and you will find it.

Rally the troops

Your attitude will make or break your ability to lead in a crisis. Equate survival with adventure and exciting new opportunities, resiliency, and creativity.

Every person in the family should be assigned one key responsibility. Even the very youngest can be named the family’s official “smiler.”

Change your attitude and your feelings will follow. Declare that from now on, in this family and htis house only positive, can-do attitudes are allowed.

Stop spending

Just stop. If it is not necessary for the preservation of life, don’t spend a nickel on anything right now. Eat from the pantry, freezer, refrigerator. Get creative with what you have.

Activate benefits

Start with unemployment. Find out the steps to activate any unemployment benefits you have so you get that first check at the earliest possible time. Make it your business to know what your state and the federal government are offering by way of stimulus, additional unemployment benefits, and so forth. Search. Research, lead and then respond.

You may have to stand in a line, but you do not have to allow yourself to feel humiliated. Choose gratitude instead.

Hoard lump sums

If you walk away with severance pay, vacation pay, or other lump sums of money, hoard them. When you receive any stimulus payouts, do not pay down debt. Know exactly which bills to pay and what to buy when you don’t have enough to cover everything. You do not know how long this challenge will last and you may need that money for basic survival supplies.

Take inventory

You need to know exactly what you have with which to survive. Anything more than a pack of breath mints should be considered a gold mine. Maybe it’s not first-class food, but you will be able to live on the staples in your pantry and the stuff in your freezer.

Pull back to the minimums

If you have been paying more than required on your mortgage, loans, and credit card balances, consider pulling back to the very minimum required until your income stream is restored. You have that option. As long as you pay the required amount your credit score will not suffer.

Cancel all non-essential services

Cancel the nail and hair appointments (learn to cut your kids’ hair); fire the lawn guy, housekeeper, cab drivers (walk or take the train.) If it is not absolutely required or necessary at this time, go without. You can reinstate services later.

Find the way out

You may get rescued tomorrow. But it’s more likely that your rescuers are not aware of your plight. For now, you have a new job and that’s to find a job. And you will. For starters, Walmart, Instacart, Amazon, and Dollar General are hiring. Supermarkets everywhere are crying for help. Take a job, even if it’s not in your field or doesn’t pay what you think you’re worth. Then keep looking. Consider it a stepping stone on your way back.

For me, the best part of great survival stories is when the survivors through tears of joy say they are better for having made it through. Some even say they are thankful for the experience. They discovered just how disciplined, creative, and strong they could be.

That same joy is waiting for us, too!

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5 replies
  1. Cathy down on the farm... says:

    Mary, My concern is the banks. We have some outstanding CC debt that I was not made aware of until a while back. Another story for another day. 🙁 I do have the money to pay that off but it’s enough that I don’t want to short ourselves since we don’t know what the future holds? I appreciate your saying pay minimums payments now, but I’m concerned the banks will take our money in the banks that we have saved? Is this possible? I’m not worried about any 401 k, as we are self employed but I, do worry about the money I have worked all my life for that the banks may confiscate! It is unthinkable to me but my parents had this happen to them many years ago… back in the 1970s. They only got a small portion back. My business is down too, at this time, but I’m hopeful this is temporary, as well. I do have some cash saved back not in the bank’s possession, just in case things don’t come back soon. Thanks for any help you can give. You’re so appreciated!

    • Mary Hunt says:

      My advice is that there is no better investment than to invest in your debt. That is an investment with a guaranteed rate of return! That “return” is the interest you don’t have to pay every month, which is most of that monthly payment. Instead that money is yours next month and next month and on and on until the date very far into the future that you would be able to clear the debt via monthly payments.

      So my advice: If you have the money in excess of your regular monthly expenses over six months’ worth of your regular monthly expensee, pay that high-interest cc debt in full. And then, if you can, put the monthly payment you don’t have to make any more, into a saving/emergency account. Win-win.

      By the way, if your bank is FDIC insured, you have very very little if anything to worry about. It is safe.

      Thanks for your kind words, Cathy!

      • Cathy down on the farm... says:

        Thank you so much, Mary. God bless you. A welcome, calming, voice of reason in a troubled world.

  2. Tammie L Herbert says:

    Mary, I tutor online as an independent contractor. The pay is less than minimum wage, but I love what I do, and with my physical limitations along with the quarantine, I continue. It doesn’t meet my expenses, but every little bit helps, right? But I’m concerned about owing a hefty self employment tax bill. Any advice for me?

    • Mary Hunt says:

      Sounds like a great side hustle, Tammie. Can you add hours and students to boost your income? I don’t know how you are paying all of your expenses if this doesn’t provide that much income, but I hope you are not going into debt every month to cover the shortfall.


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