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Money Pirates Part 1

Money pirates, they’re destructive, annoying, unexpected, and they ruin your plans. Money pirates can come in many flavors. Honestly, just about anything can be a money pirate, so in general, we’re talking about any large unexpected costs that come up.

Most money pirates are terrible events in one’s life, and often times they can’t be controlled. We obviously can’t discuss every possibility, but we’ll cover a few, and discuss some ways that you can prepare and mitigate as much of the collateral damage as possible.

So, let’s dive right in!

Job Losses

Job losses are probably one of the most prominent examples occurring today. With “official” unemployment hovering over 9%, there are a lot of people out there looking for work.

Job loss is a terrible money pirate because is doesn’t just make your immediate situation difficult, it can have a lasting effect.

Job loss takes the wind right out of your sails. Until you get money flowing again, you’re basically stuck in place for other pirates to come along and plunder.

Obviously, most people try to avoid this situation naturally, but there are some other proactive steps you can take to avoid this:

  • Emergency savings is huge! Imagine how much less your stress would be if you knew you had 6 months+ of money to float you while you are looking for a new job?
  • Be an expert at what you do. This won’t guarantee your resiliency, but you’ll be better positioned to avoid the corporate axe if they are just trying to trim out some of the dead weight on the payrolls!
  • Be low maintenance. Require as little special attention as possible, and don’t stir things up. It may not be politically correct, but companies have gotten good at coming up with politically correct reasons for firing someone who they dislike for unpolitically correct reasons. If your attitude is “I have a spine, I don’t care” then I completely support you (I don’t think people should have to be spineless to work somewhere, but it might be necessary in the short-term), just don’t be surprised if you’re looking for a new job.
  • Have a great network. Your friends will be able to get you a job far faster than your interviewing skills. It’s not what you know, it’s who you know. Never neglect the power of your network!
  • Always have your eyes open for new possibilities. Know what the local job landscape looks like, and you might even be able to land a job you like better!

Loss of home

Job loss can be one of the contributing factors to this situation, but there is also the physical loss of a home. Losing a home is a horrible situation, especially if it was under-insured. Even if it’s over-insured, money can’t buy the pictures, home videos, height-markings on the walls, and the memories. No one is immune, even Country music superstar Trace Adkins experienced this terrible event.

While home loss is terrible, the effects can have their edge taken off by making a few intelligent preparations.

  • Have an exit plan so all of your loved ones know how to exit safely.
  • Have everything insured properly, and have all valuables appraised and documented properly.
  • Have a fireproof safe for important documents, and put a hard drive into it that holds backups of pictures, videos, music, and any other important digital items you might have.
  • Make sure all alert equipment is properly working. You’re supposed to do this each month, but I don’t and I doubt many others do as well. Check your fire alarms, and carbon monoxide monitors (most new fire alarm systems have this built-in).
  • Teach all household members how to respond to certain situations like putting out a grease fire, using a fire extinguisher, or leaving the house when they are clearly in danger.

Most of these things will not stop the literal loss of your house, but they will make it easier, and keep everyone safer.

Medical Emergencies

These are terrible because they tend to be extremely expensive, and lives can be in danger. According to a CBS News article, 60% of bankruptcies in the United States can be traced back to medical bills. You don’t have to be a statistician to know that’s a huge number!

Medical is one of the toughest to prevent, and many people have little control over what happens. Without sounding terse and naive, you should strive to be as healthy as possible. Beyond that, the only other suggestion I can make is to ensure that you’ve got the best insurance coverage for your particular health and income needs. If you’re a high risk person, then ensure that you’ve got a low deductible.

There are a couple of more Money Pirates that I want to cover, but we’ll do that in our next post. Until then, “Set Course For The Horizon, Matey!” Arrrr.

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