Crisis management

Into each life a little rain must fall — the trick is not to get caught in a downpour. Loss of a job, the death of a loved one or any number of unforeseen surprises can suddenly pile up like storm clouds, sending both you and your family into an emotional and fiscal tailspin.

However, with careful planning, you can develop contingency plans to help you cope until the storm passes. The following are examples of unexpected challenges that could strike between the ages of 35 and 50. How successfully you deal with them will have a great bearing on your emotional and financial well-being.

Caring for Parents
Those between the ages of 35 and 50 have been dubbed the “sandwich” generation. If you’re a member, not only are you apt to have your own children to raise but, in some cases, you may also have parents in your care. Before this happens, it’s prudent to do some careful soul-searching. The emotional burden that comes with caring for aging parents can be overwhelming, particularly if you decide to do so in your own home. If your family isn’t prepared for what can be a drastic change, it will upset your home environment. You must gauge everyone’s needs and prepe them for this possibility. As well, you’ll need a solid support team — so if you have siblings, call on them to do their share.

Logistics also play a role. If your parents would rather “age in place” — that is, remain in a home of their own — it may make sense to move them closer to you. But if you do decide to have a parent or parents move in with you, consider carefully whether your house is physically large enough to accommodate one or two extra people. If not, try to settle on a location that best serves everyone’s interests.

Finally, there’s the often-thorny matter of finances — your parents’ and your own. Together, you should determine whether you have the means to care for them should something happen. If not, a plan must be put into action to ameliorate this. Again, if you have siblings, they must accept their fair share.

Death of a family member
Death is a most unpleasant event, especially when it strikes a young family. In fact, if the family’s main breadwinner dies, it can cause double distress — emotionally and financially. So, if you are the family’s main source of income, you must prepare for this all-too-real possibility. Through life insurance, investments and proper estate planning, you should ensure that sufficient resources are in place to provide adequately for surviving family members.

Inheriting money is usually a positive event but here, as well, there should be a sensible plan in place. Establish priorities: do you want to pay down the mortgage, buy a new car, or invest the money? It’s wise to consult a financial or tax consultant to ensure that government doesn’t get more than its entitlement. If you’re an experienced investor, take advantage of an inheritance and use the money to build a solid estate. Conversely, an inexperienced investor is liable to mismanage the inheritance, causing more grief down the road. And then there’s the emotional pothole called family discord. Large inheritances can split a family, causing arguments over how the money should be spent or the funds divided.

Loss of a job
Choosing to change careers provides new and exciting opportunities. However, an unexpected job loss — being downsized or forced into early retirement — can be tremendously traumatic. Try to build up an emergency fund to protect yourself in case of a job loss. If you do find yourself unemployed, flexibility in debt repayments helps reduce some of the stress. As well, consider your family and financial situation — don’t be tempted to “max out” your credit cards, bank loans and mortgage, placing yourself in a situation where the loss of a job could cost you everything.

To cope with job loss, ensure you are marketable — keep your skills up to date and your eyes open to new opportunities. Watch the job market for warning signs of a slowdown in your particular sector. Consider temporary employment to get you through difficult times. Above all, keep a positive attitude.