Common Reasons for Financial Crises

No matter how carefully you manage your money, an emergency can put pressure on your finances and can last for years to come. Having the resources available to handle these unexpected situations can help soften the financial blow, which is why it’s necessary to put money in your credit union account every month. Below are a few emergencies to look out for that could lead to financial difficulties.

1. Job Loss

Companies close, downsize, and reorganize all the time, taking away the income employees rely on. Even a few weeks of unemployment can leave you behind on your mortgage or unable to pay rent, which could even lead to bankruptcy. To protect yourself from unexpected job losses, financial experts recommend keeping enough to cover six months of living expenses in your credit union account.

2. Medical Emergencies

An illness or serious accident can cost thousands of dollars, even if you have health insurance. Copays, coinsurance, and non-covered expenses can be financially devastating, especially if a member of your family requires surgery or needs to be hospitalized.  It’s important to build a savings account to have that extra cushion in events such as these.

3. High Debt Levels

Credit cards, personal loans, and other high-interest debts can be a significant drain on your finances, leaving little room in your budget for savings or unexpected expenses. Paying down debts and not charging more than you can afford to pay in a single month will help keep minor emergencies from becoming financial disasters.

Emergencies are unpredictable and inevitable.  However, you can still prepare for whatever life decides to throw at you.  Something as simple as setting a certain amount of money aside every paycheck, starting an emergency fund account, or even just paying your debt down to make room for more savings is a great way to start!

With hundreds of millions of dollars in assets and over 60,000 members across Hawaii, Hawaiian Financial FCU is one of the leading financial institutions in the state, with a reputation for combining personalized service with technologically advanced personal banking solutions. Learn more about our broad array of services, follow us on Facebook, Twitter, and Instagram for news and updates, or call (808) 832-3700 on Oahu or toll-free at (800) 272-5255 with any questions.