A personal finance stress test takes a holistic view of your finances to make sure you’re not only financially stable but able to handle almost anything thrown your way.
Once upon a time, “stress-testing” was an action the government demanded of big banks; now experts say we all have to do it. The Federal Reserve now requires banks with over $50 billion in assets to annually test themselves to ensure they have the ability to handle significant headwinds. They’re also required to test themselves internally twice per year to verify things are on the up and up. What about you?
You might want to distinguish between different types of expenses: fixed expenses, flexible expenses and discretionary expenses
Having an emergency fund gives you the peace of mind to know that should something truly awful happen, such as losing your job, you can worry about how to deal with the emergency itself and not worry about how you’re going to survive financially.
When you are busy living life and working towards reaching your financial goals, the last thing anyone ever anticipates happening is a home burglary, car accident or sudden loss of a loved one.
Try the conditions that push you into crash mode and how you cope or recover from that. We work with macro scenarios and idiosyncratic events