Weathering Some of Life’s Biggest Changes

Life is full of events that change our lives and impact our budgets. From starting a family to buying a house, losing a job or a loved one, change is impossible to avoid. And although we don’t always have total control over these events, we can take steps to make them less painful. Some examples of the steps you can take to prepare for unexpected events include: Saying “I do.” It’s never too late for newly engaged or newlyweds to have a conversation about money and budgets so that they learn each other’s attitudes toward saving and spending. Consider ordering credit reports to avoid any major surprises and develop a budget to help reach immediate and long-term goals. Starting a family. Having a baby is a major change for a couple. One of the first things a couple should discuss is how they plan to build up their savings to use once the baby is born. Having additional savings to dip into can be a big benefit when mom is on maternity leave and part of the family income is lost or reduced. Thinking more long-term, parents should also develop a plan to save for the child’s education while maintaining their own savings.
Buying your first home. This is a great time to get in on low interest rates for first-time home buyers. But before running to an open house, buyers need to make sure they have a good idea of what their costs will be, including what kind of down payment can be made. A general rule of thumb is 20 percent for down payment, but the more that can be comfortably put down, the better. When determining what they can afford, buyers should also remember to account for monthly mortgage payments, fees to the lender or real estate agent, real estate taxes, and insurance and maintenance costs.
Medical emergency. Something unexpected can seriously impact a person’s finances. It’s a good idea to set up an emergency fund to protect yourself against unexpected events. Although this can be an emotional time, be sure to review all doctor and hospital bills and insurance claim payments or denials carefully. Mistakes do happen and these uncorrected errors can quickly add up. Rather than charging medical bills or letting them be turned over to collections, work with the provider’s billing department to enroll in a payment plan. Ultimately, the best solution is to have enough in your emergency savings fund to protect you in the event of an accident. A job loss. First be sure to review the employer’s benefits as an employee may be able to receive some benefits if they are laid off. Not having a job also means there should be an immediate curb to spending habits which can be difficult. This is another time where the planning and monthly contribution to an emergency account can really pay off. Using an emergency fund can help avoid racking up credit card debt or the need to borrow money. Loss of a loved one. This is a major change and most people aren’t sure what to do, especially if a loved one dies unexpectedly. Start by contacting the deceased person’s attorney or other trusted advisor(s) regarding their will. Be sure to discuss any prior instructions or arrangements that may have been made before moving forward with any funeral costs. Work with the advisors to make sure there is someone listed in charge of the estate so final bills and other financial decisions get taken care of. Life changes. Whether good or bad, can significantly impact you and your family. With some proper planning and goal setting, you are ensuring that you will reach be in a good position if or when something happens. Getting your plan started can be as easy as contacting a representative at a local bank. They can provide you with the resources you need to get started. About Citizens Bank: Citizens Republic Bancorp is a diversified financial services company providing a wide range of commercial, consumer, mortgage, trust and financial planning services to a broad client base.  For more information about Citizens Republic Bancorp, visit www.citizensbanking.com .   Molly Cataldo is the branch manager and assistant vice president of Citizens Bank of Evart