Turning setbacks into comebacks
Rebuilding after financial loss
Things like a job loss, a failed business venture or an unexpected expense can shake even the most stable financial plans. But while daunting, these moments of truth are opportunities for growth and reinvention. With the right mindset and practical strategies, one can rebuild and build on firmer grounds for the future.• Step 1: Assess the damage
First, take stock of where you are. Undeniably an uncomfortable process, it is important to understand where you are regarding making good decisions. List all your debts, your assets and immediate expenses.
• Step 2: Prioritise your essentials
When resources are tight, focus on meeting your basic needs first: housing, food, utilities and transportation. Cut back on non-essential expenses and revisit your budget regularly to adjust as circumstances change.
• Step 3: Create a recovery plan
Once you’ve stabilised your day-to-day finances, it’s time to think about rebuilding. Here’s how:
Create an emergency fund: Gather the daily loose change first. This will grow into that safety net over time.
Avail financial assistance: The short-term loans or lines of credit may be used to meet your immediate need but use them wisely to avoid falling further into debt.
Increase and diversify the stream of earnings through temporary or additional work, and other sources that may be in line with your professional acumen.
• Step 4: Insure your future
If the setback was due to some unexpected event, a disease or accident. This reminds one of the importance of adequate insurance. Be it health coverage, income protection, or personal liability insurance, being prepared for the unexpected assures peace of mind and financial stability in the future.
• Step 5: Setting realistic goals
Recovery is not a race; it's a process. Set smaller achievable milestones, rebuilding your confidence while monitoring the progress. For example, pay off one debt at a time or save a fixed amount every month. One should celebrate these wins as that's what keeps one going.
• Step 6: Professional guidance
Alone, it may be overwhelming to recover financially, and you may require help to get you on the right track. Financial advisers would be in the right position to give you a customised plan for your concerns about short-term recovery and long-term growth. They would be able to advise on investing, managing your debt, or anything related to taxes that would help in maximising your resources.
Of course, setbacks can be transformational but not necessarily easy. Setbacks can really do a lot in teaching salient lessons about one's financial habits, preparation, and how to adapt to changing circumstances. Focus on what you can control and make conscious steps forward; this is how recovery will be affected to usher you into a future that is stronger and more secure than before.
* Mignon du Preez is Old Mutual Namibia’s Group Marketing, Public Affairs and Sustainability Executive.
** Opinion pieces and letters by the public do not necessarily reflect the editorial team’s opinion. The editors reserve the right to abridge original texts. All newspapers of Network Media Hub adhere to the Code of Ethics for Namibian Media, a code established jointly with the Media Ombudsman.