It’s no secret that the current economic system that we operate within is deeply flawed. If you want to stay afloat, it is vital that you understand where the biggest risks lie, so that they can be avoided. This becomes all the more important when you have a family to support. Make sure to be aware of the following hardships that can do the most financial damage to unprepared families.
Medical Debt
This first point is a sad reality in a first-world country that still does not have government-subsidized healthcare. Families that fail to afford medical insurance find themselves in a very difficult situation if or when a medical emergency occurs. Being forced to pay out of pocket for even minor procedures can be devastating – not to mention the price of life-saving surgeries or chemotherapy. Over 130 million Americans currently struggle with medical debt that has been incurred over situations exactly like this. Working towards a job with medical insurance as a benefit is one way to prepare for this possibility.
Home Foreclosure
If a lower-income family finds themselves in an unexpected financial crisis, one of the most immediate risks is that of eviction or home foreclosure. Layoffs in a difficult job-hunting market are a common source of this, for example. As scary as home foreclosure can be, there are solutions: you can research downgrades to a cheaper living space, charities for helping families in such situations, or local centers that support homeless families in the worst-case scenario. Make sure to also understand the legal details of your contract, as there may be solutions – for example, negotiating a loan modification with the bank can help you avoid foreclosure.
External Crises
The starkest example of this is the most recent and most severe. The evidence is clear that the pandemic affected low-income families more than any other demographic since they were financially least prepared for the accompanying economic slump. Beyond just the job market, those families also struggled to have the proper resources to stock up on necessities like food, water, toilet paper, etc. This same problem arises in natural disasters – hurricanes, floods, and grid failures catch families in the middle and make it difficult for relief centers to reach them and help them.
The key for a lower-income family in the modern United States is to know your options. Being aware of the resources available to you – from government assistance, welfare, charities, local centers, churches, financial exemptions for children in public school, etc. – can make the difference when a financial emergency hits. Hand in hand with understanding the common pitfalls, you will be empowered to make it through.
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