You might be familiar with this term, most frequently associated with emergency medicine — triage: the act of determining priorities within an emergency. Well, money can work like this too. Many of us have experienced a revelation that something is NOT RIGHT with our money. Perhaps you’re just ending the money with more month left at the end? Perhaps you’ve experienced a sudden financial change such as a job loss, income reduction or new expenses.
I’ll instruct you here how to work through a budget triage. How do determine where the bleeding is, and how to stop it.
In the emergency room, it’s important to know — was your patient hit by a bus, or shot with a gun, or suffering an allergic reaction? What changed that moved your financial priorities from hunky-dory to emergency management? It’s one thing if you can easily point your finger at the source of the injury (example: a job loss). It’s another thing if all of a sudden you’re coming up short, and it’s unclear why.
If the answer isn’t clear, review your budget:
Ask yourself these questions:
Once you’ve found the source of the pain, it’s time to stop the bleeding. It might be something as simple as selling a car you can’t afford, but it may also be something more complicated, or a mixture of strategies to fill the gap.
For my family, our big financial crisis arose when I lost a job — and we were dealing with a seriously ill child simultaneously. We elected not to put me back into the workplace until our child’s health condition was under better control, but we had no idea when that would be. We devised a combination of cost reducing and income-generating strategies.
Just like you wouldn’t discontinue post-op medication or physical therapy, once you’ve patched your financial wound, you don’t get to walk away from maintenance. You must continue to maintain your plan. Make a budget every month budgeting not only your outgoings, but your income too — if income expectations change, you must adjust your outgoings to match.
Last year, I damaged a disk in my back. I got some pretty grim news from my doctor — I wasn’t a candidate for restorative surgery, but, this came with a caveat. If I could restore the strength in my back, I may be able to fully recover without any surgery, and in that case, I would be better off than if I had surgery to repair the injury — I could expect a 100% recovery, rather than 60%-80%.
Physical fitness hasn’t ever been a priority of mine, but when it came down to getting athletic, or becoming partially disabled at the age of 30, I chose to rehab my back. It took ten months, but I’m now better than before I injured my back, pain-free and 100% recovered. I’m also preventing future injury and “age related conditions” by keeping my back strong.
The budget has been the same way. Two and a half years ago, we had a financial shock, but since then, have built two small businesses, and slashed expenses. Our quality of life is substantially better, our stress level lower, and our income substantially higher than before the job loss. It’s all about the post-op conditioning/training. Think about your budget as your physical therapy. Keep it up. Each month you get better, stronger, smarter, faster. Each month it’s easier and more successful. Each month, you bank more income and meet more of your goals.
To get you started, I’m going to leave you with a quick list of triage items. Challenge yourself to adopt as many as you can, and let me know how it worked out for you.
One-day budget triage.
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I'm just an average mom, trying to live a frugal life and get out of debt. I write about things that have (and haven't) worked to improve my family's financial situation. What works for me may or may not work for you, and you should always consult a financial advisor before making important financial decisions.
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