Troubling article from the AP, Katrina Victims Pile Up Credit Card Debt:
Still, financial experts say the couple is right to be worried. The Alciatores and other Katrina victims who thought they were financially secure must keep their debt in check while facing huge relocation costs and uncertainty about their income. It’s not easy.
“People in a crisis are not thinking clearly. Their emotions take over, and that’s not a good place to be when it comes to your finances,” said Deb Outlaw, a CPA and financial planner in Dallas. “Sometimes they feel like they have to get back to what they had before the disaster, but they need to be patient.”
This underscores the importance of saving for a “rainy day”. There is always the potential for unforseen costs to crop up. If you can arrange your affairs where you save a portion of your income this will create a buffer that will allow you to smooth out the inevitable ups and downs.