Making the Best Choices in Bad Circumstances

completely broke no money

Sometimes bad things happen in life. More often than we would like, they all seem to happen at once. You lose a job, then get hit with big medical bills, and then all of your appliances quit working at once. Or, your spouse dies leaving you with no income and while you’re trying to stretch your meager savings, you find out you need a new roof and you have termites. And then you get laid off. When life conspires against you it’s tempting to throw your hands in the air and say, “Forget it. I can’t make this work,” and file bankruptcy or just give up and settle into a miserable existence.

While things are never great when you’re facing awful circumstances, you can still make some good choices that can help you get back up on your feet faster. There is nothing in such a situation that is “ideal” or a magic pill that makes everything better, but rather than giving up you can learn to deal with it and find ways to get by and eventually thrive again. When everything has gone wrong, here are some ways to cope and work towards “normal” again.

Deal with the Emotions

It’s tempting to just bury your head in the sand and pretend that nothing is wrong. Denial won’t get you very far, though. In fact, the longer you try to deny there’s a problem, the bigger and worse the problem is likely to get. Go ahead and express your emotions. If you’re angry at the injustice of it all, go ahead and rant and rave. If you’re sad about losing things you loved, go ahead and mourn the losses. Once you’ve gotten the raw emotions out of your system, find more proactive ways to deal with your emotions. Exercise reduces stress, positive actions make you feel better, and diversionary activities can give you a break from your problems (but don’t let your diversions take you completely away from fixing your problems).

Pay Things in a Sensible Order

If everything is in chaos, you might find yourself just paying bills as they come in, or paying people who send the most notices. Maybe you try to pay off the people to whom you owe the most first. Since you have limited money, you’re trying to spread it around as much as possible. This isn’t the right way to deal with financial problems. You need a plan for dealing with the bills. The first thing you always pay is your mortgage or rent because you need a place to live. Then you pay your utilities so you can keep running water and electricity. Next you pay for groceries, then your car (unless you can get by without a car to get to and from work). After that, you pay for your most necessary items in order of priority. If you need medications, those take priority over your cable TV subscription, for example. Make a budget and see where everything needs to go and in what order, and then stick to it.

Debt Payments Can Wait

When it comes to paying off any debts that you have, most can wait (the exceptions are for the mortgage and the car payments which, since the debt is secured by the house or the car, can result in the loss of those items and significant hardships for you). Credit card payments and other forms of unsecured debt can wait. Yes, your credit will take a hit and you’ll have to deal with annoying phone calls, but there’s really nothing they can do to you. You can try to negotiate with them but if that’s not possible they’ll just have to wait while you take care of the most important things.


Note that paying things in this order does not mean that you get to have/keep the best of everything. You may have to downsize to a house you can afford or sell the house and get an apartment. You may have to sell your car and buy a beater. You may have to get used to store brands. When you’re in financial trouble, you not only have to pay things in a sensible order, you must also make certain that you have enough money for your necessities and that likely means cutting back.

Keep Saving

It sounds impossible to save when your financial world is in disarray, but you really do have to keep saving. Otherwise you’ll never really dig out. Even if you can only put away $5 a week, it’s still worthwhile. Saving even a little bit will pull you that much further ahead so that when you finally do dig out, you hopefully won’t have to repeat the process. Where does the money come from, you ask? It comes from cutting something you don’t really need or want. Or finding a way to bring in more money. Even in the direst circumstances, there’s usually something that can be done to boost your savings.

Make the Hard Choices

If you ever want things to get better, you’re likely going to have to make some hard choices to bring in some financial breathing room. This may mean selling a home or taking the kids out of private school. It may mean relocating, moving in with family, or taking on a roommate or extra job. The thing is, while choices like these stink, they also tend to bring in large chunks of money that can be used to get you on your feet sooner. The longer you delay making the hard choices, the more money you lose (or at least you don’t gain). I’ve seen people wait literally years, knowing these choices had to be made, but still trying to avoid them. All it does is cost them more money. Go ahead and do what needs to be done and get it over with. Prolonging the pain doesn’t do any good. When things get better, you can reevaluate and bring some things back into your life.

Laugh (a little)

While it’s tempting to just wallow in despair, it can help if you can find a little humor in the situation. Keeping a positive outlook is essential to getting things back in order. When you make decisions from a positive mindset, those decisions are more likely to be productive, rather than destructive or reactionary. A little laughter and fun makes you less stressed and better able to make good choices in bad circumstances.

When everything goes wrong, it is still possible to make good choices and decisions. You may have to think a little harder about what to do and what to pay, and some of your choices and decisions will be painful. It’s not easy, but even in times of crisis you can act wisely and keep moving forward.

(Photo courtesy of danielmoyle)

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4 Responses to Making the Best Choices in Bad Circumstances

  1. Minny says:

    We have always taken the ‘grasp the nettle’ attitude. We had endowment policies to pay our mortgage. Just three years from the end we were told there would be a substantial shortfall.

    This left us with a difficult choice to make. We did not want to extend out mortgage or change it to a repayment. What we decided to do was to make the shortfall, to pay the maximum allowed each month by out mortgage company and to save.

    To do this we went on an ultra frugal money diet. Got rid of one car, cable, found the cheapest in out utilities and generally lived a very frugal life. The internet was a brilliant source of information. We also took on extra work where we could. We did a complete money makeover with the Martin Lewis website. From the forum we learned so much about living frugally.

    When the three years were up we had three times what was needed to pay the shortfall – it was unbelievable! But many people we discovered in the same situation simply buried their heads in the sand. Suddenly they were telling us we had been ‘lucky’, yes, we were lucky in that we are people who deal with problems that arise. The majority of people in that situation could have saved but it would have meant giving up their pleasures. In the end all it did was to defer the giving up of pleasures,

  2. Minny says:

    Sorry, got off the point there. What I was trying to say was it is only by grasping the nettle that problems get dealt with.

  3. Gail says:

    Minnie still a terrific example of what happens when you decide to make things work and not waiting to the last minute to deal with it.

  4. Shirley Brown says:

    Great Advice Thank you.

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