5 Tips to Maintain Financial Security in an Economic Crisis

1. Decide You Will Not Make Panicked Choices

When news of the Coronavirus’s magnitude first hit, many stockholders panicked. Fearing a recession, people sold stocks in massive numbers. Still others spent money they didn’t have, running up credit card bills that charge 18% interest, on groceries and cleaning supplies they didn’t necessarily need for fear their stores would run out. Panicked choices that cause us to spend or hoard money usually are not wise or prudent.

No matter what we face, no matter how dire situations appear, God calls us to be wise financial stewards. That means making rational, well-thought out decisions not based on fear. “Your goals rather than the headlines should drive your decisions,” said Edward Jones Financial Advisor Kim Hoffman.

We need to remember, though our stock market indeed may crash, it always bounces back, and dismal unemployment rates eventually improve. Our economy historically has gone through predictable cycles of growth and contraction. In fact, in 2018, economists said we were about four and a half years overdue for the next recession. Financial security comes, in part, when we prepare for inevitable dips and rises. This means avoiding risky investments and the temptation to react rather than act proactively.

We were created to function with a sound mind, not based on fear, and to demonstrate the courage and confidence befitting children of Christ. We may struggle significantly now, but never to the point that we can’t recover, because we belong to the God of hope. No matter how chaotic our circumstances feel, God remains in full control and owns “the cattle on a thousand hills” (Psalm 50:10, NIV).

In other words, He’s got us, our world, our stock market, and the economy firmly in His grasp. That doesn’t mean circumstances will always turn out as we desire, but we can trust God will work all things, including our biggest mistakes and struggles, for our good (Rom. 8:28). So don’t panic. Instead, seek His will, listen for His guidance, make wise choices, and trust Him to handle everything else.

Related Resource: Check out my new podcast: Faith Over Fear. In this podcast, I strive to help you see different areas of life where fear has a foothold, especially in this time of Coronavirus, and how your identity as a child of God can help you move from fear to faithful, bold living.

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2. Decide to Cultivate a Long-Term Perspective

When our finances feel uncertain, our vision can narrow until all we see is today. We might lose sight of the fact that our decisions today will reap long-term consequences, positive or negative. While Scripture never encourages us to “stockpile” or feed our greed, it does instruct us to plan ahead.

Proverbs 13:22 tells us “A good person leaves an inheritance for their children’s children,” and Proverbs 21:20 says, “The wise store up choice food and olive oil, but fools gulp theirs down” (NIV). To put it another way, fools live for momentary pleasure, without thought for tomorrow or their descendants. But we are far from fools. Instead, we mimic the ants who “stores its provisions in summer and gathers its foods at harvest” (Proverbs 6:8, NIV).

A. Plan for future expenses.

My husband and I started talking about our daughter’s wedding nearly from the moment she was born. We knew this would be a large expense, and so we made plans, well in advance, to fund it. Then, once she became engaged, we determined a reasonable budget, reduced our spending, and found ways to earn extra money so that we were able to cover it all without incurring debt. We also determined to spend within the funds we had. As another example, he and I share a car that currently has 136,000 miles on it. We know we’ll likely need to purchase a new vehicle within the next few years, so we’re making plans now to pay for it so that we don’t have to spend double its worth in financing.

During the C19 scare, that may mean reducing, or cutting entirely, our spending on entertainment, cable, or other unnecessary items so that we have funds for inevitable household repairs. Then, should we lose our jobs and our furnace break, we’ll be less likely to rely on financing.

B. Avoid rash decision making.

In 2018, we had a significant financial hit that scared us. Initially, we both felt tempted to panic. Around this time, we received a letter from our bank inviting us to refinance our house. Curious, my husband spoke with the loan officer, and she began to explain what sounded like such a great offer! If accepted, we could lesson our monthly mortgage and thus give ourselves more breathing room and increased peace—in the short term. However, we also knew our finances would change significantly, for the better, in a few years.  Therefore, we didn’t need a drastic solution but rather a plan to carry us through until our situation improved.

After careful investigation, we realized, though refinancing would reduce our payments, the interest we’d accumulate would lead to tens of thousands of dollars’ worth of debt. We determined the expense wasn’t worth the benefit. Instead, we found ways to increase our income and reduce our spending. The result, we made it through that challenging time as strong financially, if not stronger, than before the tax change.

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3. Decide You Will Not Spend When Emotions Are High

Numerous people are having to make difficult choices during this C19 scare. For many of us, our children are home, are bored, and are missing friends. We might have had to cancel birthday parties or graduation ceremonies and family vacations. All of these losses can negatively impact how we handle our money.

My family is dealing with this now. My daughter and her fiancé are scheduled to get married next month, and while there’s a chance the social distancing rules might be lifted by then, we’ve had to make some difficult decisions. In our attempts to make the best out of a disappointing situation, we’ve determined to hold a private wedding, with ten people or less, in our backyard this spring and a more formal celebration a year from now. Great solution, right? The only problem is, this could lead to extra expenses. Praise God, the company we’re renting the venue from will allow us to postpone the date without a fee. But we’ll need to buy an additional cake, hire the photographer twice, and will need to order and send out more invitations.

My mama’s heart wants to say, “Don’t worry. We’ll just put it all on credit!” But I know that wouldn’t be wise—for any of us. When parents don’t make smart financial choices, which include staying out of debt and planning for retirement and long-term disability, their children ultimately pay the price. That price can be a lot more devastating than a frugal wedding. With this in mind, we’ve determined to stick with our original budget and adjust accordingly. We believe this is not only a way we can actively love our daughter and her fiancé by planning for the future, but it also models financial wisdom.

This involves all those smaller purchases that seem so inconsequential in the moment but add up and ultimately throw our finances off, as well. Basically, if we don’t have the money, we don’t do it.

4. Decide to Avoid Unnecessary Spending

Unless you’re preparing your home to sell or have ample funds in your savings account, now is not the time to remodel your kitchen, buy that new car, or embark on that luxury vacation. In fact, financial advisors suggest avoiding all unnecessary spending, eating out included, until one has enough funds saved to cover six months of unemployment. Today’s global circumstances reveal why this is so important, and why we’d be wise to start tightening our purse strings today. No one knows how all of this social distancing will affect our economy, but most experts are predicting a recession. As a result, many could lose that job they feel is so secure. Those who have a six-month “emergency fund” still might have to make challenging decisions, but they won’t be devastated.

In 2006, my family went through a period of unemployment followed by what resulted in a three-year upheaval. Praise God, my husband and I entered that season debt-free and with enough savings to carry us through. As a result, we weren’t forced to make panicked, emotional decisions, and though we felt some level of anxiety, we also experienced significant peace.

5. Decide to Use Today’s Experiences as Lessons for a Stronger Financial Future

Some of you might be reading this thinking it’s too late for you. You’ll be entering the recession not only with zero savings but also significant debt. Recognize, though things might feel tough for a while, maybe even a few years, you can recover. You and your family can bounce back from anything—if you lean on Christ and learn from today.

Eventually, you can buy a new home or secure a new apartment, get a new job, open that savings account, and start that 401K. In the meantime, focus on maintaining hope and holding on to Christ and one another. Then, once things have settled down in our world, determine to live differently.

Almost two decades ago, my husband I were in significant debt. We routinely impulse shopped with little thought for our future. Eventually, we realized we’d need to make some drastic changes, and so we did. We started attending biblical financial classes, lived as frugally as we were able, and from that moment on, took determined and positive steps toward financial freedom. We began living by a budget, and that involved paying off all our debts as quickly as possible, no matter how painful that felt in the moment. Then, once in the black, we made a commitment never to land in debt again.

As a result, though that year was painful, God used it for good.

Recessions will come, and they will go, but God remains sovereign and promises to stand with and guide His people forever. He will empower us for whatever challenges we face and will help us to respond to our most tumultuous financial struggles with calm, wisdom, and a long-term perspective. In fact, He will use every trial and uncertain moment to mold, teach, and grow us as He steadily moves us toward His good and hope-filled plans for us. Jesus died to set us free; may we never allow ourselves to become financially enslaved.

If you’re feeling particularly anxious, make sure to check out my Faith Over Fear podcast on LifeAudio for faith-bolstering truths that can anchor you securely in Christ, no matter how fierce life’s storms blow.

Jennifer Slattery is a writer and speaker who’s addressed women’s groups, Bible studies, and writers across the nation. She hosts the Faith Over Fear podcast with LifeAudio, is the author of Building a Family and numerous other titles and maintains a devotional blog at JenniferSlatteryLivesOutLoud.com. As the founder of Wholly Loved Ministries, she’s passionate about helping women discover, embrace, and live out who they are in Christ. Visit her online to learn more about her speaking or to book her for your next women’s event and sign up for her free quarterly newsletter HERE  and make sure to connect with her on Facebook and Instagram.