Personal Finance and Be Money smart! – Part V: Shit happens!

Key takeaways:

  • Personal finance can be affected by local/global economy;
  • Future can be unpredictable, so always have a Plan B;
  • Your Plan B should support you through the storm;
  • Start building your Plan B today; it’s never too late.

I feel like writing this article because it’s a good timing for many people to read. Since the pandemic of COVID-19 started in early 2020, the biggest concern among my coaching clients has been money. Many people have been financially affected by the pandemic and for some, the impact could be huge.

I had catchups with my coaching clients in late March and some of them were heavily affected. At my end of the telephone line, I could feel the tension of some clients when we discussed the overall situation of job market and personal finance.

After finishing all the calls, I was surprised to know that many people didn’t have a financial Plan B. When a big event struck like the pandemic, if you don’t have a Plan B, then it’s like walking in a thunderstorm. You are gonna get wet; perhaps, very wet. Although the storm may not last long, the impact could last for a lot longer.

A ‘black swan’ event is not common but the impact on our finance and mental health can be huge and real.

A black-swan event is rare but can hit you hard (Photo by Pixabay on

A Plan B should be always available for some aspects of our lives and the most important one is the financial Plan B. Money is essential for our lives, although money may not be everything we are after in our lives. Without money, you can’t do anything and you can feel the impact immediately.

A financial Plan B should be strong enough to support you through a financial storm. Then, how should we prepare this Plan B? I’d suggest starting with reverse engineering.

Start from your essential expenses that you need per month. This may include loan repayments, rent, medical insurance, utility bills and grocery. With this sum, then multiply it by 12. That’s the amount of money you need to survive the storm without selling your assets (for example, selling your house or your car). If you can’t save for a 12-month Plan B, then at least, try to save for a 6-month Plan B. This 6-month Plan B lifeline will support you through the storm and allow you to look for options without too much worries. It’s like walking in a huge thunderstorm with an umbrella; you may still get wet but you are protected.

A Plan B will save your day in a stormy weather (Photo by Genaro Servu00edn on

Mind the keywords here: ‘survive’ and ‘without worries’.

When a major event struck (for example, losing your job amid the pandemic), you can survive by activating your Plan B. By activating your Plan B, you won’t need to worry too much about not being able to pay bills or buying grocery. This Plan B doesn’t only survive you, but also ensure that your mental health is sound.

I was concerned about some of my coaching clients because their mental health was heavily affected by worries; all sorts of worries. With a solid Plan B, most of those worries would go away and you will have time to get back to your feet. If mental health declines during the stormy weather, then it will drag all things down to the drain. This has happened to many people during the pandemic recently.

Mental health is the most important thing when a big event strikes (Photo by Andrea Piacquadio on

Start building your financial Plan B today. It’s never too late. If you have been hit by the pandemic without a solid Plan B, then you know that it’s time to build one. If you are fine to weather the COVID storm because you are well prepared, then review your Plan B and make sure it’s strong enough for the next black swan event.

Shit happens in our lives. Just make sure that you can survive the black swan event. Whatever doesn’t kill you will definitely make you stronger!

Dr. C. Richard Wu @

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