Finance

4 ways women can prepare their finances for unexpected life-changing events

You may feel like you have your finances in order right now, but would you be prepared if life threw a financial crisis at you, like an unexpected home problem, medical expenses, or unemployment?

Here are some ways every woman can be financially prepared for whatever comes her way.

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Be aware of your current financial status

If you don’t usually handle your household finances, do an audit of your family’s financial accounts.

“Make sure you know where all your accounts are,” said Samantha Melting, SVP, head of consumer banking at Synchroni. “[Take note of] account numbers, current balance and payment amounts and how to access accounts — passwords, user IDs, website address, etc. This includes bank accounts, retirement accounts and insurance.”

Melting recommends storing this information in a safe place.

“This becomes very important if someone else, like a partner or spouse, is taking care of your finances and you suddenly stop trying to figure it out during a difficult time,” she said. “I was not prepared for the loss of my husband, who managed our financial affairs, and realizing this after the fact was very challenging and added to my grief.”

Build an emergency fund

Another important way to prepare for an unexpected life event is to have an emergency fund that can help you weather the financial impact of the event without going into debt. Ideally, you should have three to six months of living expenses saved in an emergency fund.

To help your funds grow faster, consider putting your money into a certificate of deposit. While traditional certificates of deposit charge you a penalty for withdrawing funds before the CD is due, the Synchroni option allows you to access your funds without penalty, which is especially helpful if you need money to cover an unexpected expense.

Another option for your emergency fund is a high-yield savings account. This account has no minimum balance or deposit requirements, and no monthly fees.

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Create an estate plan

In order to be prepared for the unexpected loss of a partner, it is important to create an estate plan.

“Have a plan, a will or an estate plan that covers the transfer of wealth and assets,” said Hilary Fiorella, executive director of the American College’s Center for Women in Financial Services. “Make sure you have a living will, power of attorney and durable power of attorney for all health care needs.”

Reevaluate your financial goals

After any life-changing event, it’s important to make sure you get your finances back on track so you’re ready for the next curve.

“It’s time to reset your financial goals to reflect your new life,” Melting said.

This is especially true if you have experienced the loss of a partner.

“Are you saving enough for retirement if you’re the only one saving for it now?” How will your lifestyle have to adjust to the potential loss of income?” Melting said. “This is the time to evaluate your expenses, savings and investments to meet your goals in the short and long term.”

After a major life change, it may be beneficial to seek professional help.

“You may be comfortable making these decisions on your own, but it’s also okay to seek help from an expert to help you set up a plan that works for you,” Melting said. “This can be a stressful time in your life, but investing in you now will empower your future financial success.”

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This article originally appeared on GOBankingRates.com: 4 Ways Women Can Prepare Their Finances for Life-Changing Unexpected Events

The views and opinions expressed herein are those of the authors and do not necessarily reflect the views of Nasdaq, Inc.


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