“Adjusting to a sudden income loss in your family involves thinking about more than just dollars and cents.”
Adjusting to a sudden income loss in your family involves thinking about more than just dollars and cents. You have many attitudes, values, and feelings about money from your childhood and family upbringing. Many of these are so deeply a part of your everyday life that you don’t even realize how those feelings affect your money decisions or your reactions to money decisions of other family members.
Everyone experiences changes in life. Sometimes you plan for it and sometimes things happen over which you have little control. When the latter happens, you are facing an unplanned change. Unplanned income changes can result from unexpected job loss or loss to your home or business by forces of nature such as tornadoes, floods, and drought. Market changes in commodities or stocks, or major expenses resulting from an illness, equipment breakdown, burglary, or accident can also cause such changes. Unlike a planned change, it is much more difficult to make adjustments for unplanned income changes because the choice to change has been taken away from you.
This publication will help you understand what happens in the first few months after an unplanned income loss as you deal with the overlapping emotional, economic, and social effects (Figure 1). A major decrease in income requires that all family members recognize the grief they feel over the loss (emotional effect), reassess how money will be used within the family (economic effect), and make a conscious effort to manage the inevitable disagreement and potential conflict that might arise (social effect). Doing so will help you live with the consequences of the unplanned income change, develop new options, and move on.
Figure 1. Consequences of Unplanned Income Loss