By definition, a crisis is a turning point, a time when you have to make crucial decisions (often suddenly) that will affect your future. Although smart planning is the key to effectively dealing with periods of crisis, you may find yourself suddenly dealing with an unexpected event that you didn’t prepare for, and you wonder what to do next. Whether you’re planning ahead or dealing with a crisis now, take control. There’s no escaping the fact that a crisis is a life-changing event, but how you handle a crisis will, in part, determine whether your life changes for the better or for the worse.
Dealing with an immediate crisis
Act, don’t react
Often when facing an immediate crisis, you want to do something, just about anything to solve the crisis, or you want to run away. While both responses are natural, neither is helpful. While you definitely need to do something in a crisis situation besides hide your head in the sand, you shouldn’t do just anything. In fact, it may even be preferable to take no action for a few days to let your emotions cool a bit. Then, act, but don’t react. To the extent possible, collect information and advice and formulate a plan. You may have only hours or days to do this, but some plan is better than none. If you feel that you can’t keep your emotions separate from your actions, ask a friend, relative, or professional to help you sort through your options.
Make a list of things that you need to do
When you have to plan in a hurry, the easiest way is to make a simple list of things you have to do. List as many items as possible. Then, as you do them, you can check them off. This is important because when you’re under stress, you may forget to do important tasks. In addition, a list will help you remember to focus on action, not reaction.
Find help
No one should have to weather a crisis alone. Even if you’re alone in the world or if you don’t want to burden your loved ones with details, there are community resources and individuals (paid and unpaid) who can give you general and specific advice.
Dealing with a Future crisis
Identify and manage risk
What future crises are you likely to face? While you hope that the answer to this question is none, that’s an overly optimistic thought. It’s almost inevitable that you will face one crisis or more during your lifetime. While you can’t have a plan to deal with all possible risks, you can plan for events that seem likely and for some events that may seem unlikely. You should, for instance, plan for events such as death, illness, and job loss. You may not, however, have to plan for crisis risks that are unlikely to affect you, such as divorce (if you are single or happily married), or natural disaster (if you live in a non-disaster prone area). Knowing that you have some plan will help you deal with a crisis if you ever do confront one.
Jane and Hal built a beach house in Malibu. Their home was swept away in a mudslide, and they spent months replacing their personal possessions, as well as getting duplicates of their birth certificates, insurance policies, and other personal and financial records. Five years later after they had rebuilt their house, a fire swept through town, and their house was destroyed. Fortunately, this time they were ready. They had kept their important records and financial information in a safety deposit box, and had sent boxes of photos to Jane’s mother for safekeeping.
Plan for contingencies
Any plan you make for dealing with a future crisis should be flexible. Part of the stress you feel when confronting a crisis is because crises are unexpected and unpredictable. You won’t know ahead of time how you’ll react and exactly what you’ll have to confront. One good approach is to plan for a worst-case scenario. For instance, if you plan for a period of unemployment that lasts for two months, what will you do if it stretches for six months? If you plan around a six-month period of unemployment, however, you’ll know what to do if it only lasts for two months.
Organize your records
A key component of planning for a crisis is organizing your records and personal papers. This is particularly true if you become sick, incapacitated or die and your loved ones have to assume responsibility for your finances. You will also be able to readily access vital information instead of wasting time and energy trying to find it. At the very least, you’ll want to set up a filing system and give a list of your important documents and advisors to a trusted friend for safekeeping.
Plan your finances
Unless you have significant liquid assets, planning for a crisis means, in large part, planning your finances. Many financial professionals advise their clients to keep an emergency fund equal to at least three months worth of expenses, just in case your income flow stops or your expenses increase. This emergency fund can make a big difference because many things can change in three months. If you don’t have the emergency fund, however, you may have to make hasty decisions regarding your future, such as taking a new job you don’t really want, selling prized personal possessions, or dipping into your college or retirement fund. You should also work up a bare-bones budget that reflects only your basic living expenses. Cut out all luxuries, and determine the least amount of income you need to survive.
Quantify your plan
When you plan for a future crisis, don’t be too general. Instead, be as specific as possible and write down your options. This way, you’ll be less tempted to avoid decisions by thinking you’ll deal with that when the time comes, and you’ll have something concrete to refer to if you must deal with a crisis situation. You’ll feel calmer, too, when you’re facing the crisis. People who live in areas prone to natural disasters often keep emergency kits in their cars or homes in case they need to evacuate in a hurry–a good example of this principle.