How to manage storm mode - dealing with money during crisis

How to Manage Storm Mode

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You may have heard me talk about storm mode recently and wondered what on earth that means. I use the term storm mode when I’m talking about dealing with anything that is going to put extra stress on your finances. Things like global pandemics that result in temporary or permanent job loss. Or any time where your income is affected. Today we are going to take a look at the when, why, and how of storm mode! 

I like to think of my Emergency Fund as an umbrella, protecting my family from getting rained on when the car breaks down, or the washing machine needs to be replaced. Those situations do not create stress in our home because we have an Emergency Fund to cover surprise expenses. We don’t ever turn back to credit cards to cover costs, because we have an Emergency Fund! 

Related: Emergency Funds: How to Protect Yourself From Disaster

But – what do we do when the rain shower turns into a hurricane? That is where storm mode comes in. Any time your income is going to be impacted (i.e., job loss, illness, maternity leave), the focus for your money needs to change. 

If you know you are going to have less money coming in, you need to be as proactive as possible. That means saving every extra penny you can until the storm passes. It also means changing the priorities in your budget. 

Step One – Use a budget.

The first step in any financial plan is using the tools available to you – in this case, a budget. I cannot say this enough. When you take control of your money, your money loses its control over you. If you are looking for financial freedom, you don’t need a huge windfall or inheritance or even a raise – you need a plan. 

Related: How to Start a Budget that will Change your Life

Step Two – Cover your four walls.

Storm mode means cutting all unnecessary expenses. It means no more restaurants, no more shopping, no more (fill in the blank for the things you like to spend money on). 

Your goal is to cover your four walls.

  • shelter
  • food
  • utilities
  • transportation. 

With your adjusted income, your first priority is to make sure you can pay your rent or mortgage, buy food for your family, cover essential bills, and pay for your transportation. 

These are the things you need to survive. Everything else can wait.

Step Three – Pause your debt snowball.

If you are working on paying off debt and have been chunking extra money onto your balances and making great progress – HIGH FIVE! I love to hear stories about people rocking their debt snowballs.  


Your goal during storm mode should be to have as much accessible money as possible. So instead of making extra payments, maintain your minimum payments for the duration of the storm. 

Step Four – Save save save.

Now that you are using a budget and covering only your four walls, you may find that there is extra money left to ‘spend’. 

But, hear me well: every extra penny needs to be saved.

The money you would usually spend on movie dates and drive-thru? Save it. 

The extra money you’ve been working so hard to earn to pay down your debt? Save it. 

The tax cheque, birthday money, stimulus cheque, Emergency Relief cheque, whatever random extra money flows into your account? You guessed it. Save it!

You can use this saved money to cover your four walls, when your income comes up short.

The goal right now is to stretch your money as far as you can. So that – you don’t go back/further into debt. So that – you don’t lose your home. So that – when the storm passes (and it will pass), you are no worse off. You may not be better off, in that your credit card balances may still be there and you may be frustrated by the months of lost progress. But I call that lack of progress a win still!

Related: More Money Saving Tips

Are you ready to put your budget into storm mode? I created this video to walk you through it, step-by-step! Check it out now for a guide to storm-mode-ing YOUR budget – and don’t forget to like and follow us so you don’t miss out on any future videos! 

Step Five – When the storm passes

Nothing lasts forever, and this storm (whatever that may be for you) is no exception. 

Seeing as I’m writing this during the pandemic, I can name our storm. But these situations come up regularly. Your rental property sits vacant for six months due to a downturn in the market. You break your leg and can’t work for two months. A global pandemic shuts down all things, and you are laid off, with no idea when the world will resume. 

One day, when your income returns, the storm clouds will part, and life can go back to normal. You can add more income to your budget and start spending money again. You can make extra debt payments and save for holidays. You can focus your money on your long-term goals because right now, you are making some short-term sacrifices. 

If you come out of storm mode with extra savings, amazing, you can put it towards your goals. For me, that will be funding our trip to Disneyland. 

If you come out of storm mode without extra savings, but no new debt, that is amazing too. The goal is to maintain, so if you can find that balance, then high fives all around!

And maybe, just maybe, you’ll have learned that you can live without so much spending, and you’ll find even more room in your budget. In my experience, when I cut back due to necessity, I learn how much less we need to get by.

Wrap Up

I know this isn’t pleasant – no one wants to be in storm mode. The good news is: it will not last forever, and with the right tools (ahem, your budget!!) and a bit of discipline, you can weather any storm! 

How to manage storm mode - tips for handling personal finance during crisis

Still have questions? Right now it may be comforting to know that you are not in storm mode alone. And believe me when I say – you are not! Jump into the conversation in our private Facebook discussion group!

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