We conduct fire drills to ensure fire warning systems are functional and that building occupants know what to do in the event of a fire-related emergency. Apply that same type of stress test to your money with a financial fire drill.
Photo by Steve Snodgrass.
Finance and frugality blog Frugal Dad urges us to take stock of our financial health by conducting a financial fire drill. Just like a real fire drill helps you run through a dangerous scenario without risk — "Who put the file cabinets in front of the fire exit?" — a financial fire drill shows you how effective your escape routes are and how big your safety net is.
You'll need to gather up all your bills, take stock of your savings and emergency fund, and head over the Frugal Dad to run through their financial fire drill checklist — which includes great tips like making a slash-and-burn list of non-essential services you can cancel the minute you get laid off or in other financial trouble.
Sound the Alarm – It's Time for a Financial Fire Drill [Frugal Dad via Wise Bread]