Financial setbacks are pretty much unavoidable, but how you respond to them can make a HUGE difference in your future. Whether it’s a small issue, like an insurance rate hike or a big one, like a job loss or a pay cut, you’ll need to be prepared. Whatever you do, do NOT ignore the problem. Take a deep breath and stuff the panic back in its box, then sit down and crunch the numbers. Figure out where you can cut back. Maybe a second car can be sold, or some other things around the house can go, and perhaps cable TV isn’t all that important? Increasing your workload for the short or medium-term will help, too, since that extra income can go straight to the crisis. If you really can’t meet your minimum payments, contact your creditors before they come looking for you. That will soften the final blow. You might even have to swallow your pride and reach out to family and friends to see if anyone can float you a loan or get you some extra work. And when the crisis passes, be sure to prepare for the next one by setting up an emergency fund! Do that now!

Read More