What to Do When You Have Financial Problems

(Psst: The FTC wants me to remind you that this website contains affiliate links. That means if you make a purchase from a link you click on, I might receive a small commission. This does not increase the price you'll pay for that item nor does it decrease the awesomeness of the item. ~ Daisy)

By the author of Be Ready for Anything and the online course Bloom Where You’re Planted

I’m going to start this article telling you why February and March were terrible months for me. I had some major financial problems, but there’s a moral to the story, so bear with me. (I’m not just whining or looking for sympathy, I promise.)

What I want you to take from this is how just about anyone can run into hard times financially, no matter how carefully you try to prepare. Although I know there should be no shame in this, I was terribly embarrassed when I ran into problems lately.

It’s what you do to bail yourself out of your financial problems that determines whether they’ll be ongoing or whether you’ll recover and get back to a state of comfort and security.

Medical bills took a chunk out of my financial security.

Everyone has heard about the terrible flu going around the United States this year. It killed thousands of Americans swiftly and without mercy. So, when my youngest daughter became ill, I immediately began doing everything possible to help her recover. She’s normally a healthy child and we eat well, take all the right supplements, and nurture our immune systems. But, she works with the public in her program and flu happens.

Soon, I had run through my arsenal. We tried all sorts of home remedies and supplements, but this virus was relentless. Knowing as I did how many people had died from it, I took her to the doctor and the hospital. Not once, not twice, but three times.

We do not have health insurance because our monthly payment is double what I pay for rent, nearly $2000 a month for 60% coverage after we pay $10,000 in deductibles. Instead, I sock away money for paying in cash. (Even after our recent crisis, my decision is the most cost-effective one.)

With two kids in college right now, my emergency fund is like everyone else’s – good but not unlimited. Within 3 weeks of my daughter’s illness, I’d gone through my entire emergency fund and maxed out two credit cards that are ordinarily unused. I don’t regret it for a second because her flu turned into bronchitis, then viral pneumonia – she needed medical care.

But I began March in overdraft in all three of my bank accounts and in thousands of dollars’ worth of credit card debt. I used a third credit card to buy gas to get everyone where they needed to go and I didn’t have a penny to my name.

It was a sickening feeling, especially after I’ve worked so hard to create an atmosphere of financial stability for my children. I felt physically ill every time I looked at my bank account online or saw another bill in the mailbox. I was embarrassed, frazzled, and feeling desperate.

Some of you may read this and think, “Wow, Daisy’s supposed to be telling us how to get out of debt and here she is maxing out credit cards and telling us about it. Unsubscribe!”

You can do that, but please consider continuing to read this article, just in case you fall on hard times yourself.

It can happen to anyone.

Obviously, I’m not telling you about our financial saga to make myself look bad. I’m telling you because I want you to know that no matter how much you try to do everything right, financial problems can happen to anyone, at any time. Whether you have $100 in the bank or $100,000 in the bank, something can happen that wipes out your emergency fund just like it did mine.

This doesn’t mean that you failed financially – it means that circumstances can affect you, just like they do everyone else, no matter how careful you are.

Before my daughter’s illness, I was doing everything “right.”

  • I had enough money in my emergency fund to carry me through 3 lean months
  • I had numerous credit cards with zero balances
  • My only debt was my car
  • My kids are going to school without student loans
  • I opted out of health insurance because it was more financially practical to pay cash (and I still agree with that decision)

Everything was great.

Until it wasn’t.

It’s what you do next that makes all the difference.

So, here I am, the Cheapskate Queen, with maxed-out credit cards, no emergency fund, and little in the way of disposable income.

But here’s the good news. If you know how to deal with these kinds of emergencies, it’s only temporary.

Here are the steps I’m taking to get things back on track.

  • When I got paid next, I put $500 in my emergency fund.
  • I found some places to cut my monthly expenses. (Go here to read about auditing your expenses)
  • We ate from our pantry and used personal care items from our stockpiles.
  • I immediately began snowballing debt to pay it off quickly (Go here to read about the snowball method of debt repayment)
  • I organized a yard sale to make some extra money and listed some bigger items on Craigslist
  • I worked on some extra projects to bring in some cash, all of which went to debt.
  • We pared our expenditures to the bare minimum this month.

How I raised some money.

Lots of folks who knew my situation recommended that I put up a GoFundMe page and ask for donations, but I just couldn’t bring myself to do it. This isn’t to say bad things about people who do so – I’ve donated to many of them myself. But I felt that my situation, while exceptionally stressful, was not dire enough to ask for people to just give me money and that I had some resources to earn the money instead.

Because I’m a writer, I finished a book I had been working on and put it up for sale immediately. (You can check out my new book here.) I am selling it for a low introductory price to sell lots of copies quickly and help myself out of my current bind. Of a necessity, the price will go up once it’s on Amazon, but for now, I can sell it for only $5.49 per copy.

You may have different talents that you can put to work to make extra money quickly, like consultations of some sort, custom-made handcrafted items, the food you’ve raised on your homestead, childcare, tutoring – you get the idea. Get your product or service to market quickly and reasonably, and worry about charging higher prices later.

We worked together as a family to reduce our expenses to an all-time low and use the supplies we already had on hand. While I still have some debt, I’ve begun to rebuild my emergency fund and pay things off as quickly as possible. We were able to do damage control and keep the negative effects of a bad month to a minimum.

Keep reading the April issue for more money-making ideas and a guide to having the perfect yard sale. (Subscribe here)

And don’t forget to help others. As bad as your situation may feel, there are probably other people out there in the same boat or similar. I offered a PDF copy of my book to those who can’t afford it. (Email me if you fall into that category: daisyluther2 at gmail dot com). This is my personal philosophy and it’s good in two ways – you’re helping someone out and you never feel as sorry for yourself if you are in a position to help others.

Here are the steps to take when financial disaster strikes.

The first thing to remember is that you must forgive yourself for getting into trouble financially. It can – and does – happen to just about everyone. It’s how you deal with it that determines whether you’ll regain your equilibrium afterward.

  1. Audit your situation. See where all your money is going, see how much debt you’re in, and see what the most immediate ramifications will be.
  2. Take care of the most important things first. In most situations, keeping your home paid for (rent or mortgage), paying utilities, and making your auto and insurance payments should come first. Take care of the things that will have the most immediate ramifications first.
  3. You may have to make some late payments on less vital things. If so, communicate with those to whom you owe money and try to make arrangements. This may affect your credit, but by communicating with them, you can keep damage to a minimum.
  4. Cut your expenses. When you audit your situation, you may find some places that you can slash your regular expenses. Don’t hesitate to reduce services that are unnecessary or to whittle down your monthly obligations. (More ideas here)
  5. Put a little money back into your emergency fund as soon as possible. This may sound counterintuitive but having a bit of money for minor emergencies means that you won’t need to rely on credit cards for these things, putting you even further in the hole.
  6. Pay off your debts. Use the snowball method to attack your debts. Start paying these off AFTER you pay for the things I recommended in step 2.
  7. Use the things you have on hand. Delay a trip to the store for as long as possible by planning a menu using the food in your pantry and freezer. (Think about the stockpile challenge we did and use those strategies. Get some ideas for meals from your stockpile in this article) Use the shampoo, soap, and personal hygiene products that you have already instead of buying new products.
  8. Raise extra money. This may come from selling things you don’t need, taking on some extra work, or by creating a product or service to sell. However you do this, use the extra revenue wisely to get out of debt and to rebuild your emergency fund. There are more ideas for making money quickly in this issue.

It’s a difficult, humiliating situation, but it’s something you can fix. If you are in a longer-term, more dire situation, this article may be helpful to you.

Things will get better.

Things might be tough right now but know that it can happen to anyone, even me, the Head Cheapskate. Take the right steps to regain your financial equilibrium and limit the long-term damage of your situation.

I hope that knowing it happened to me, too, is helpful.


Picture of Daisy Luther

Daisy Luther

Daisy Luther is a coffee-swigging, globe-trotting blogger. She is the founder and publisher of three websites.  1) The Organic Prepper, which is about current events, preparedness, self-reliance, and the pursuit of liberty on her website, 2)  The Frugalite, a website with thrifty tips and solutions to help people get a handle on their personal finances without feeling deprived, and 3) PreppersDailyNews.com, an aggregate site where you can find links to all the most important news for those who wish to be prepared. She is widely republished across alternative media and  Daisy is the best-selling author of 5 traditionally published books and runs a small digital publishing company with PDF guides, printables, and courses. You can find her on FacebookPinterest, Gab, MeWe, Parler, Instagram, and Twitter.

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  • Daisy, you really need to investigate colloidal silver as a means to treat as well as prevent bacterial and viral infections. It is easy enough to make, and I can help with some shortcuts, if you wish.


  • I am the household accountant and I constantly make adjustments. My biggest problem as a step parent is getting the step kids to care enough to turn lights off, and anything else that has to do with saving money. I did not raise them so none of my way of living is instilled in them. I got them when they were 12 and 15, now they are 15 and 19. I have tried EVERYTHING. From asking nicely and explaining why, to taking their electronics away after a 3 strikes rule. I am so frustrated at this point. I even took their light bulbs out so they had no light at all and still they leave them on. Anyone on here a step parent and had success with turning lights off, chores, etc.?

    • You didn’t mention how the biological parent fits into all of this. The kids need to see their biological parent supporting you in this endeavor. Biological parent needs to step up to the plate and get involved, otherwise, it’s not going to happen AND you are always the ‘bad’ guy’. What do I mean by stepping up to the plate? The kids need to see that parent turning off the lights or whatever you are asking kids to do (even if in a joking manner). That parent can help by also reminding the kids to turn off lights, chores, etc. And, that parent should be the one to dole out punishment or at least show you support. The kids need to see a unified front. We found out that making a game can sometimes get better results than threats. The struggle is real – I feel your pain!

    • Desiree, I feel your pain, I really do. My wife and kids are the same way. It was as if I was talking to the post. They would agree to change their ways only to have them play me lip service. This is how I fix it. I went to Home Depot and purchased a timer switch. I put one in the garage, and one in their bedrooms and TV room. (You can get them to last an hour or thirty minutes.)

      They weren’t happy about the changes; but, at lease the lights were turned off. It just meant that they had to get off their butts and reset the timer(s) if they needed more time to use the lights.

    • Your average 20w led bulb uses about five cents worth of electricity per day. If your biggest problem is the kids wasting 5 cents per day (assuming they leave a light on 24/7), I’d say you don’t have much in the way of problems.

      • Stan, you are minimizing this by equating it to a “big problem” – yay, if she doesn’t have any “big” problems, NOW. Although one could argue the whole virus/shutdown thing is a pretty big problem. I these family members had been cooperating all along, perhaps the family’s emergency fund would be a little bit bigger as would their expenses going forward in uncertain weeks/months ahead.

        This is largely a principle issue and an example of how important it is to learn and adhere to good habits EVERYDAY. E.G. hand washing, having some extra groceries and personal care items on hand (perhaps bought while on sale) to be used for when your budget is tight, you are sick, there is a pandemic.

        “Those who will not save a penny, shall never have many”.
        “Take care of the pennies and the dollars will take care of themselves”
        “A penny saved is a penny earned”
        “The Debtor is slave to the Lender”

  • Your story just speaks to why we all need to do what we can to be prepared *in general*. I constantly imagine what would happen if a financial crisis hit and….I had NOT stockpiled a pantry full of food, had NO closet full of hygiene/medical supplies, did NOT take the time to acquire skills that could be turned into side gigs, did NOT establish relationships with friends and family who could help hold me up til I’m back on my feet. The greatest thing about being prepared is that when one part of your life falls apart, you’ve got all these other areas set and on standby to get you through. I hope you’re able to bounce back quickly. Keep up all your great work!

    • Jill, I hope that Daisy’s story gave you and others the rude awaking before it is too late. Far to many people are unprepared for an emergency, especially and medical emergency or a personal emergency. So I hope you will take the incentive and start to prepare now. The sooner your start the better off you and your family will be, THAT GOES FOR THE REST OF YOU TOO! Don’t delay, start today. If you read Daisy’s blogs then you have a good starting place to make your changes.

  • Daisy, very sorry to hear that your daughter was so sick, and I’m glad she’s doing better now! Thanks for sharing the lessons from your financial D-Day, and props to you for doing the hard work to deal with the financial crisis yourself. Your tenacity and resourcefulness is inspiring. Wishing you financial success and your girls luck on their exams!

  • Thank God your daughter is okay, Daisy. Good luck with your financial recovery and thank you for another insightful article.

  • same here. medical $$ since january have thrown it all out of kilter. no room left on credit cards and into the overdraft every month–thank God for the overdraft. 36$ per year and worth a lot more!

  • Each city/ country always budget for indigent care. Go to the local ER and play indigent. Don’t feel guilty because “your” taxes pay for this care. Why should illegal aliens get free care and Americans can’t?

    • It sounds good in theory – until the hospital threatens to withhold care until you file for Medicaid. Then, before you can leave, bills you eight times as much as you could have paid to get out the door if you’d had cash. Yeah, they aren’t supposed to do it – that’s fine, who’s going to stop them? When you’re in the hospital with an infection starting to attack your loved one’s kidneys, she’s feverish and out of her head, you’ll sign anything you have to. That’s how a 700 dollar medical bill ballooned to 5000 dollars before it was even late.

      • Redbranch – I’ve had the same experience of having the bill multiplied many times if I didn’t pay when we received the service. This is why I opted to put what I couldn’t pay in cash on my credit cards. At least then, it’s a known amount.

  • Daisy, You may already have a “Health Savings Account” but if not, seems like a good idea as it has some tax advantages.

    • The HSA would be great except that you can’t qualify one unless you have a high deductible health insurance plan. Bottom line, if you have insurance, you may qualify for a tax advantaged account to pay for all the costs you are still likely to have since the ACA essentially destroyed the remnants of an already imperfect health insurance system.

  • Daisy, your advice is all good. A few things I might add after a lifetime of “financial crisis”. Often time you can negotiate debt with credit card companies, hospitals and others. If you have issues that require being late with mortgage you can call your lender and tell them the situation…am not sure about a rent situation but there may be some room to negotiate that as well. If you are not insured for medical (and I agree with you on that) then a hospital/lab/doctor will almost always accept payment plans. You are such a frugal person and talented at advice- your finances will improve in a short time. Thanks for sharing!

    • I wish medical people accepted payment plans where I live. Most actually don’t, though some will give you leeway if you are an established patient. You can definitely negotiate debt, especially if the debt has been sold to a collection agency. If you have a good history with your landlord they may let you slide. Then again, I’ve seen people out on the street for being ten days late. No mercy.

  • If you have high medical bills talk to the doctors and hospital involved. i have found that many of them will set up payment plans and even reduce charges if you are upfront with them.

  • Hi Daisy, Great article and thanks for sharing. You’re right, things can go south very fast! I never post and tell people what they should do or give unsolicited suggestions, but there’s a medical insurance company called Medi Share that is much more affordable and operates the way insurance “was meant to”. Doesn’t pay for well visits, but for emergencies and illnesses. Very affordable. It was like $500-$600 per month for my husband and myself! Drs often discount your care if you’re on it. It’s a community of insured people who pay for and pray for each other. It’s accepted in all states now. I will be sure and order your newest book also. Thanks!

  • I’ve been enjoying your good advice for a long while and just subscribed to your newsletter. We must be kindred spirits. Years ago our family went through a similar financial dry spot after a job layoff. Like you we had done everything right…six months of expenses, a stocked pantry and the like. In hind sight it was a very valuable life lesson that helped our entire family become more grateful, more aware, and much better stewards of what we had. Thank you so much for sharing your hard experiences with others so we can learn as well.

  • Daisy, I’m sorry to hear that you found out the hard way what it is like to have no medical insurance when you really need it. I hope that your daughter is doing better. American’s throughout this country has the same type of problem – no medical insurance or limited amount of insurance. We as Americans take so much for granted like our health until we have to pay for it.

    I applaud your immediately steps to stem and curtail your financial loss as quick as possible. However, you need to take into consideration that there are those that are not so lucky. They may be a single income family or a single parent. What most people don’t realize is that 60% of Americans work jobs which only pays them when they complete their work. They don’t have a safety net to catch them and they often find themselves spiraling out of control until they hit the ground, hard.

    So on your next go-around when you write your next book; put down in writing your experiences, your recommendations and how to right oneself should they find themselves in a similar situation. I would be interested in if you reached out to your friends and family for assistance and how that may have played a part in your recovery. Also, how many people turned away from you because you were in need. I think you see where I am coming from – the new America.

    I wish you and your family well and good health. I do love your blogs and perhaps one day I can afford the $5.00 a month for your Cheapskate’s guide to the galaxy. But until then, I too am looking to cut cost where ever I can find them. GOD Bless and keep plugging those holes where you are losing money.

    • Dear Jumpoffa:

      Thank you for your kind words.

      I’m a single mom and the sole breadwinner in my home. It’s terrifying sometimes, but life is what life is, and though I’ve definitely hit rock bottom before (I lost a home to foreclosure and a whole bunch of other horrible stuff), I’ve always been able to recover. The lessons learned were tough, but valuable.

      I did not borrow money from friends or family at this time because I felt that I would be able to pull myself out of the situation. Fortunately, I was.

      Great comment and questions!

      • As a single parent with two kids I know your pain, your fears, loneliness when having to make those tough decisions. Nothing makes you feel better when you see the light at the end of the tunnel having overcome a major difficulty or seeing the rewards for all the hard work you put into something you had faith in. I also understand the disappointments, failures and near misses. For what you have accomplished so far; I can honestly say that I am proud of you.

        I really didn’t have the family support that everyone should have. I made my friends my family. These are the people that I depended upon for my support and survival. If you find this to be the way you are doing – for what ever the reason(s); remember this; They LOVE YOU TOO. Don’t forget them, especially when you are in need, for they are family too. This is a lesson I just learned this Easter, which happened to be my birthday.

        So Daisy, as a new friend of yours, I got your back. If I can help in any way possible all you have to do is just ask and I’m there for you.

  • I’ve been there way too often. It takes me months and months and months to build up a little emergency savings. Then in one emergency it’s all gone. I barely manage to pay for our essentials, and I have to start all over again.

  • Thanks for sharing the Slightly Less Glamorous part of your life with us. Prayers for healing and getting back on your feet soon. I’m looking forward to reading your book!

  • Hi Daisy , please research on MMS. its a medical treatment which cures many deseases. you can make it yourself. absolutely worth it.

  • Miracle Mineral Supplement, is the name. pl research…. a friend of mine has very good experience with it.

  • For some reason, people can be hard to find and that leaves businesses across the country with un-cashed checks that are returned to them in the mail. These checks can be for wages, dividends, and assorted other things, but all of it is considered un-claimed funds, and the government requires businesses to turn it all over to them if there has been no success in locating the owner/employee.

    It is possible for you or a business to quickly determine if your funds are being held by state government. Simply visit a website or two, the first of which is: http://www.missingmoney.com

    This website covers about forty of the states, and simply by entering your name or business, you can find out if governments are holding your money. There will be a last known address given and a little thing advising if it’s more than or less than $100.00. If you find your name and a familiar address, all you have to do is claim the money.

    When you have completed your search in your state of residence, then you should take the following additional steps:

    • Enter your name in any previous states where you have lived.
    • Enter any previous names you may have had. (Maiden names, etc)
    • Enter any business names you may have owned. (Enter in last name field)
    • Enter family member’s names.
    • Enter deceased family member’s names. This one produces quite a lot of “hits” and you may be the beneficiary or next of kin who can claim these funds.

    Be creative in your entries. If you have an uncommon name, entering just your last name should be sufficient. If you have a common name, you might start by entering just the first initial of your first name to thin the list out. If your business name is Acme Widgets and Doodads, Incorporated, try entering just Acme Widgets or Acme Doodads. Also try misspelled words like Acmy Widgets or variations of your name such as Johnson vs. Jonson or Johnsen.

    Since this site only covers about forty states, then if the state you are interested in isn’t part of this site, you should do an Internet search using words something like the following: “Unclaimed Funds CA.” Most of the states run these programs through their departments of commerce, so you should be watching for a site like that.

    You should not pay any third party for this service. Your tax dollars already fund this process and the states should not charge for returning your hard earned money to you.

    I’ve personally never found anything for myself – maybe because I’m an accountant and I have a habit of keeping track of money, but I have found over $100,000 for friends, family and the businesses that I work for. Try it yourself and see if you don’t find money you weren’t even aware of.

  • You Need More Than Food to Survive

    In the event of a long-term disaster, there are non-food essentials that can be vital to your survival and well-being. Make certain you have these 50 non-food stockpile essentials. Sign up for your FREE report and get prepared.

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