How to Prepare for the Unexpected


One of my favorite mottos is, “expect the best but prepare for the worst.”  As an optimist, I have no trouble expecting the best, but that very optimism can be a deterrent to preparing for the worst.  Why?  Because I allow my optimism to cloud reality.  This post is therefore a self imposed challenge to become better prepared.  Hopefully, these tips will also help you if any of the following unexpected events occur in your life:

Your wallet is lost or stolen.

Remove sensitive information you don’t need to have with you, such as your Social Security card and personal information numbers for any and all financial transactions.  Photocopy (or make a list) of the items you normally carry in your wallet.

You lose your cell phone.

Download one of many free or low cost apps which will track your phone by GPS.  Lookout Mobile Security, for example, will not only find your phone, but will allow you to remotely make it “scream” even if the device volume is set on low or silent.  (Note: I downloaded the free app on my Droid, tried it, and was quite impressed.  It does what it says, and the “scream” will definitely get your attention.)  Another tip: you should also check with your carrier to learn how to make a backup of your address book.

Your power goes out.

The best preparation is to have a whole-house (or portable) generator, fueled up and ready to kick in.  Other suggestions: know where to find your candles and matches, keep flashlights readily available, maintain an inventory of extra batteries (including an extra, charged cell phone battery), purchase a portable – perhaps a hand cranked – radio, and keep your freezer packed with ice in order to be able to preserve your food as long as possible.

Your car breaks down. 

If your car’s warranty or auto insurance includes road side assistance, keep the contact number  in your glove box and your cell phone.  Make sure you know where your car jack is located and how to use it.  Also, double check your spare to ensure that it is inflated and road worthy.  Keep an emergency roadside kit which includes a jumper cable, flashlight (with extra batteries) and, if winter weather is a factor, a blanket and gloves.

The IRS audits you. 

In general, you need to keep your tax returns and all supporting documentation for at least seven years, but IRS publication 552 specifies which documents to keep and how long to keep them.  Keeping good records, such as your tax deductible mileage and dated receipts for charitable contributions will be invaluable in case of an audit.  Take time to include some hand written notes of anything you might need to remember with your return.  Keep your digital copy of your return on your computer, and back it up outside your home.

You lose your job.

This is the biggie. The bad news is that it takes time to prepare, but the good news is that this preparation is necessary if you ever lose your job or not.  What am I talking about?  Getting out of debt and building an emergency fund.  Once your debt is gone, you will be able to live on less (a necessity when you don’t have a job), and once you build your emergency fund (consider at least six months of expenses), you will be able to breathe while you plan your future.

Reality happens to everyone, and it will happen to you.  Don’t wish you had been prepared; take time to prepare now.

How prepared are you?  What other unexpected events should we be preparing for?  Leave a comment!

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  1. MCody

    This may also be added to prepare for the unexpected, a child. Just a thought. One may think two responsible people will decide to have a child, but you may never know what God has in store.

    • Joe Plemon

      How true that you never know what God has in store. My wife and I have experienced those unexpected blessings ourselves!

  2. Kat

    I’d also add emergency evacuations in the instance of storms, floods, wild fires, etc. A little bit of pre-planning will make things a lot less chaotic if you need to evacuate your home quickly.

    • Joe Plemon

      Kat — that is something we haven’t planned for. We are working at keeping one car full of gasoline “just in case”, but we don’t have an emergency suitcase, packed and ready to go. Good tip!

  3. Joe Plemon

    Cherleen — Great tip. My wife does the very same thing. But she sometimes carries both wallets in her purse, so if she lost her purse or if it was stolen, she would still have lost both her money and her important documents. I have used a “front pocket” wallet for years. It is impossible for it to accidentally fall out of my pocket, like a rear pocket billfold may do, and, besides, I never did like sitting on a bump anyway.

  4. Rich Avery

    Great tips, Joe. The most recent hurricane, Isaac, reminded me again about how vulnerable we all are to disaster. Sometimes, we can get a warning, but other times they hit us with no warning at all. I’m so amazed at how many times in scripture, especially in Proverbs, God tells us that wise people take the time to plan ahead.

  5. Christian

    I think you forgot to include how we Christians should prepare for the upcoming financial collaspe.

    • Joe Plemon

      You are right Christian. One could write volumes on that topic, but I am curious: what suggestions would you make about being prepared for the upcoming financial collapse?

  6. Glen Stephenson

    The big thing that I find most people don’t prepare for is – loss of their ability to provide income due to illness or injury.

    How many of you consider the consequences of what would happen to you and your family if you were to suffer loss of income for an extended period of time?

    If it’s a minor injury or illness then there is most likely little harm that will be done to the family budget. But what would happen if you were involved in a serious car accident, you may be incapacitated and be unable to work for weeks, months or even years.

    You might be the primary bread winner for the family – What are the consequences of your inability to generate income? Will your family go hungry? Would you have enough savings to cover all the bills and day to day living expenses?

    Perhaps you have you already thought about this and have a Plan B like:
    – Disability insurance
    – A private health fund membership, which pays out when you are unable to work
    – A store of cash in the bank – just in case something unexpected happens throughout the year.

    If this is you – Great! Keep up the good work.

    If not then loss of income through injury or illness is something that I feel everyone should be catering for in their yearly budgets. In the best case scenario – you budget for something that you didn’t need, and you continue living your life in full health. You might even score a weekend away with the money you put aside and didn’t use.

    Should you suffer an injury or illness then at least you have some form of coverage, which should lessen the financial burden until you are able to recommence employment again.

    • Joe Plemon

      Glen– Good wisdom. In the post, I recommended a large emergency fund to cover several months of job loss, but I didn’t mention losing the ability to work. This is where disability insurance (something many people overlook) is critical. Thanks for the good word!

  7. JP Adams

    Joe –

    Thanks for the great post! Before I become financially disciplined I bought a condo, bought a bunch of clothes and spun around town in a new car. I didn’t have the tools then and it cost me.

    I was wondering if I could get your thoughts on lending or giving money to family and friends that need it. Its a difficult topic. We all want to help those we love as much as we can but sometimes things arise unexpectedly and we’re not prepared.

    Here are a couple specific areas I’d love to get your thoughts on
    – What types of costs should you focus lending a hand on (e.g., school, health)
    – What percent of your salary and/or savings should you consider when helping a loved one?
    – Are there any negative downsides to financial helping someone you care about? How can you minimize them?

    Thanks for your thoughts – I’ll chime in as well!

    • Joe Plemon

      JP — Allow me to share a couple of thoughts about helping family and friends.

      1. My wife and I have a policy: we don’t lend money. Period. Our reasoning is that lending money creates a huge risk to the relationship if the borrower can’t afford (or doesn’t) repay the loan. We would prefer to have someone temporarily miffed by our “no” than permanently lost as a friend. Now…this being said, if we have the money to loan, we have the money to give. So we will often simply give the money, with no strings attached. Of course, the gift would need to be for a real and pressing need, for someone who is already doing their best, meaning that we need wisdom on our part to distinguish between helping and enabling.
      2. One needs to help others from a position of strength. What I mean is that if the one who wants to help is in financial disarray himself, he would not be wise to plunge further into debt or not pay his bills in order to help another person. This should be a motivation to become strong financially (get out of debt and build wealth).

      One more thought: my wife and I budget “bless money” every month. We put this budgeted cash in an envelope so we can always be ready to help others. It is fun to be have the money easily available when needed.

      I hope these thoughts help.

  8. JP Adams

    Thank you for your thoughts Joe and for sharing a bit of your and your wife’s story. I particularly like your point about giving as opposed to lending money. I am 100% on board with you on that. Regrettably I had to learn that lesson the hard way.

    One area where I have struggled a bit is thinking about larger financial assistance to family members and close friends. In particular for my sisters and I, we are thinking about how to help our parents through retirement.

    The big difference here is that we are speaking about large sums of money. And right when my parents need help my sister is sending her kids to school.

    Some of how you can help is small. But then I think there’s the broader question of helping family members with multi-year financial stability.

    It’s a complex topic. My initial impression is that it takes planning, a collective and loving discussion of the issues, and consistent tracking.

    I’m not sure if you and your wife have experienced something in this area but if you have any thoughts I’d appreciate your perspective. Thank you!

    • Joe Plemon

      JP — No, my wife and I have not experienced the need to help parents financially through their retirement years, but I agree that this can be a real dilemma. We are called to honor our parents, and helping them during their senior years (assuming they will accept the help) is a way to honor them. But the balance is trying to plan for your own retirement so you won’t be a drain on your own children. Like you said, it takes planning, a collective and loving discussion of the issues, and consistent tracking. These factors, coupled with the fact that all siblings will not be able to contribute equally, does indeed require clear and frank discussions.

      I hope you and your sister and your parents are able to reach an agreement that you are all happy with.

  9. JP Adams

    Thanks for your thoughts Joe. You make a good point that their is a balance between assisting a loved one financially and planning for your own family’s future. There are also ways in which we can lend a hand and provide emotional support when financial funds are not as accessible.