Survival May Be New Definition of Success

In today’s economy, it’s not exactly business as usual for American consumers. We face a perfect economic storm of uncertainties, especially with potential changes coming in the wake of this year’s elections. “Survival” may be the new definition of “success” in these uncertain times.


Here are a few financial survival skillsthat consumers would do well to follow:

• Maintain sufficient liquidity.

You may be gagging at the almost non-existent returns ofmoney markets, or the negative returns at banks (once all those fees are factored in), but remember that survival rations are never particularly appetizing.

Hold both your nose and some cash for the time being. You want sufficient liquidity — an emergency fund — to get you through possible job loss, furloughs or a cut-back in your work hours. The last thing you need is another threatening cloud to the forecast in the form of additional debt.

Prepare a budget.

This is tantamount to making sure you have bottled water and canned goods on hand for a major hurricane or other disaster. Both budgets and beef stew should be staples on your shelf.

If you do not know what you are spending or where adjustments are possible, your ability to respond, or even take advantage of, adverse financial circumstances is very limited. Not just the financially strong, but the financially flexible are in the best position to weather any storm.

Take a long-term view.

This is equivalent to boarding up the windows and settling down to read a timeless classic by candlelight. You won’t be affected or agitated by the things happening outside, and are thus unlikely to make quick, emotional responses that only compound the problem.

The physics of financial markets, just like the laws of nature, ultimately restore equilibrium and a more predictable order. As long as you have some staying power (see No. 1), you’ll be okay.

Eleanor Blayney, CFP®, Consumer Advocate, Certified Financial Planner Board of Standards
Eleanor Blayney, CFP®, Consumer Advocate, Certified Financial Planner Board of Standards

Do some financial planning with a CFP® professional.

This is the most comprehensive and sensible response to future uncertainty. A plan is not just a “beef stew budget”; it includes the emergency numbers and the fire drill plans, too: recommended risk management procedures, an inventory of available resources for both bad times and good, and strategies for surviving and thriving financially.

A 2012 study by the CFP Board and the Consumer Federation of America showed that those Americans who had a financial plan not only felt more confident for the future but were, in fact, financially stronger than non-planners in a number of key areas.

There is going to be a lot for consumers to react to in the coming months. But uncertainty of outcomes is usually more financially disruptive than the outcomes themselves.

The key to survival, and ultimately to financial success, can be found in a classic poem by Rudyard Kipling, found perhaps in that book you set aside to read during the storm. The poem posits as a sign of maturity: “If you can keep your head when all about you are losing theirs…”


Eleanor Blayney is CFP Board’s Consumer Advocate. She is recognized as one of the pioneers in the profession of financial planning who helped to shape the financial planning practice standards that guide the work of the more than 66,000 certifed financial planners, CFP®

She earned an MA in English Literature from the University of Cambridge in the United Kingdom and an MBA from the University of Chicago.