Adjusting to Suddenly Reduced Income
Summary
Reactions to an unplanned, sudden decrease in income are not simple. The situation probably involves circumstances over which you have had little control. Many people tend to blame themselves and end up "beating themselves up" or hurting others. What happens in such situations involves a complex web of emotional, economic, and social interactions. It is important to recognize that there are various stages of grief that you will experience as you adjust to the income loss. Reach out to others rather than blaming yourself or others. Involve the whole family including children in reassessing how money will be used. Take stock of current expenses, discuss how spending can be adjusted, communicate with creditors, and look again at your financial goals for the next few months. Personal goals can be assessed individually. However, when you spend the time and effort to set mutual, agreed-upon family or family business goals, the decreased amount of money available will be used more effectively and efficiently. Recognize and be ready to manage the inevitable disagreement or conflict over how the reduced amount of money will be used. Doing so will help you and your family live with the consequences of the unplanned income change, develop new options, and begin to move on.
Worksheets:
- Worksheet 1: Monthly Spending Plan
- Worksheet 2: Reassessing Targets for Your Money, Time, and Energy as a Result of the Income Loss
- Worksheet 3: Goals
- Worksheet 4: Conflict Management
