5 Personal Finance Rules You Can Break During a Crisis

A crisis can throw life out of gear and disrupt our plans, so it always helps to have a backup

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Alongside mental and physical wellbeing, it's now common knowledge that financial wellbeing is key to a secure future. It's easy to be caught up in the world's glitz and gloss and spend as much as you want whenever you want. While all of this is entirely okay, the critical aspects of saving and investing sometimes tend to take a backseat in such a situation. To ensure sound financial health, we often set specific personal finance rules to devise a budget, track income and expenses, making money management smoother and more efficient.


We frequently hear our parents and other elders, and even financial consultants advise children and us to start saving and drawing up a budget early. The ability to handle your money wisely is one of the most valuable skills you can possess. It is both an art and a skill that should be instilled in a person from the beginning, as it is crucial for physical, mental and financial wellbeing. However, in the event of an unprecedented crisis, the situation may call for us to stray from our finance plan. At such a juncture, it's essential to know what personal finance rules we can break. Let's take a look.

Dipping into your safe/emergency fund

When your finances face a strain, the simple answer would be to draw from your emergency savings, making it crucial to build one right from day one. Remember, life is inherently unpredictable, and emergency circumstances often present themselves with no warning and necessitate a prompt response. As a result, it's a good idea to set aside money for unforeseeable situations or crises. This will ensure that you continue to get a portion of the funds until they are ready to be used as needed. The emergency fund should not be used for anything other than dealing with unforeseen circumstances, as it will come in handy when you need it the most.

Delaying EMI payments for some days/weeks unless you are capable of repaying

Never take on additional debt if you want to live a stress-free life. Even while taking a loan, it's crucial to analyze all aspects and steer clear of common moneylenders to avoid falling into a debt trap. While most of us may have EMIs or other interests to be paid, it's best to delay paying these bills for a few days/weeks when faced with a financial crisis. However, before delaying payments during the crisis, you must be regular in your payments. This will improve your creditworthiness and the trust factor, and your lending organization may be more inclined to allow a slight delay.

Allocating savings towards long-term needs like a house, car purchases, etc. vs. needs of the immediate crisis

One lesson we've learned from the pandemic is the need to have more cash on hand. Relying on others for financial support during a crisis can have an adverse impact on your finances as well as your relationship with said person in the long run. Therefore, it's critical to invest in instruments with high liquidity so that you can rapidly liquidate your investment and receive the funds in the event of a financial emergency. Rather than allocating resources to long-term demands such as a home or a car, you can put your money in mediums or commodities that can be quickly liquidated when needed.

Investing in high-risk assets like stocks, cryptos, etc.

Investment decisions are affected by several factors. When it comes to investing, there is no one-size-fits-all answer. So, before investing in assets like stocks and cryptos during a crisis, sit down and assess your entire financial situation. It's critical to keep an eye on the market for opportunities to buy high-quality assets at low prices.

Not sharing details of all your financials with your close confidants, family members, etc.

Investing is a personal decision, as is money management. And while we usually keep our closest confidantes informed overall about financials, it’s completely acceptable not to do so in case of a crisis. Although the goal of investing and insurance is to help your family and secure their future, crises often call for some drastic measures as they can be trying times.


A crisis can throw life out of gear and disrupt our plans, so it always helps to have a backup. The aforementioned tips can come in handy if you’re dealing with an unexpected financial crunch and can help you get by the difficult time.