The government shutdown isn’t the only thing that can throw your financial house into disarray. A layoff, job loss or even slow paying clients can all temporarily impact your monthly cash flow.

The steps you take today can ease the pain of having your income seriously reduced. Most people wait until they’ve spent all their available cash or maxed out their credit, which can then create serious long-term financial consequences. Be pro-active and chose to be in control of your money rather than the other way around. The MINUTE you realize your financial situation may be changing, start implementing the four strategies below.

And by the way: Give your ego NO attention if it tries to guilt you into feeling unworthy or lacking because you’re making these changes. The goal here is to maximize your income to cover essentials as long as your income is reduced. These are immediate, temporary actions to be taken to achieve a specific goal. Enough said.

Let me put it in everyday terms for you. Let’s say you’re driving and you see traffic is slowing down. When this happens, you probably take your foot off the gas. However, if you discover traffic is coming to a complete standstill in front of you, you’re more likely to slam on the brakes. You don’t wait to stop your vehicle until AFTER the crash happens, right? These four steps are designed to keep you from crashing and burning:

Step 1: Stop ALL auto pays. This includes ANYTHING that comes out automatically from your paycheck or bank account or gets automatically charged to a credit card. This gives you the flexibility to pay essential items on your time schedule and can reduce or eliminate insufficient fee charges. And by anything, I do mean anything.

If money comes out automatically to put into savings, retirement, or pay off debts, stop them for now. This will also maximize the amount of money you have available if your income is cut for a longer time and you need money for gas, food or essential utilities.

Step 2: Cancel non-essential expenses. Of course, doing this second step requires you to first know what IS essential. Essentials are your housing (rent or mortgage), insurance (health, home, life and car), your transportation (car payment/gas or public transportation), and your food (and we’re talking groceries here, not dining out, yes?), followed by utilities (which are gas/electric, water and phone.) Believe it or not, there’s a whole segment of the population that does NOT have internet or cable or streaming tv at home!

Paying on credit cards, student loans and other unsecured debt is NOT essential. Neither is going out to dinner, the movies, getting your nails done or going to the gym — or even buying things to make yourself or others feel better.

Step 3: Sell everything you can to generate cash. Start with high end items and collectibles and move on down to everyday items that aren’t essential. No one needs multiple televisions, a high-end stereo, the latest phone, etc…. it’s what we call a “First World problem.” And most of us have cabinets full of small and large appliances, tools and exercise equipment that can be re-homed anyway. Books, DVDs, shoes, bags, clothes… let ’em go… even knick-knacks. Free up the financial resources that are trapped inside these items — and don’t hold out for top dollar.

The same goes for luxury items. Sell the Harley, the RV, the ATV, snowmobile, trampoline, boat, even the extra car or vacation home. (And if you’re paying for a storage unit, sell the contents and eliminate that expense too!)

Make it a game of sorts — to see how big of a cash cushion you can create for yourself as you wait out the lean times. In the end, you may discover that much of what you let go of you really don’t have any interest in having back in your life!

Step 4: Tell people what’s going on. If other people rely on you for anything financial, sit down and talk with them. Even folks you owe money — including creditors. Information is king here. Let creditors know you are stopping your payments temporarily, that you don’t know WHEN you’ll be able to make a payment and that you will keep them posted. Call them once a week to update them. And ignore their attempts to get you to pay on these debts. Their job is to guilt you into paying THEM instead of making sure your basics are covered.

Your job is to stay in integrity, cover your basics, and then resume payments as soon as your financial situation improves. If they’re nasty or persistent in any way, simply hang up after you’ve given them your update. You’re not obligated to “confirm” or share any other information with them.

And what about conversations with the people closest to you? These talks can be as scary (or even scarier!) than talking to creditors. Telling your kids they have to temporarily stop gymnastics, or you can’t buy them the latest video game, or they have to switch to a less expensive school, or you have to sell the extra car can be hard. Start with “I love you AND we’re a team so we’re going to work to move through this!” Tell them you understand how upsetting these changes can be AND don’t take the bait if their fears cause them to lash out at you. Stay the course, implement your plan and give yourself a little financial peace of mind knowing you’ve done everything you can to generate as much income as possible from what’s currently available.

(Next week, I’ll share some more ways to talk about money with your friends and family — and even your employees, clients and vendors if you’re a business owner! If you’ve got a specific scenario you’re coming up against and need help communicating about a financial issue, email me at and I’ll do my best to address it in my column.)