Do you feel like you are on an uncontrollable roller coaster, looping through crisis after crisis with barely a moment to catch your breath? If yes, you aren’t alone. Many of us are feeling just that, and it is reshaping the way we need to think about all elements of our lives, including the financial aspects.
As a financial planner, I used to believe that we needed to plan for emergencies that might potentially come up once or twice in our lifetimes. I grew up in an era where employees stayed in their jobs, or at least within their professions, for long periods of time usually decades. They knew they needed emergency reserves for that one big life change, layoff, divorce or other life altering experience that may or may not have ever occurred. But the last few years have turned that upside down as life is moving too fast for this archaic mindset.
A New Reality
Since the start of covid in early 2020 there has been very little stability in our lives. We rolled from lockdowns to the invasion of Ukraine which affected the global supply and prices of commodities, to the civil unrest in Israel, to the disaster of 7th October, the ensuing war in Gaza, the 12-day (although it felt like an eternity) war against Iran, to who knows what will be next. These very dramatic events haven’t just changed the way we live, they have changed how we need to think about money. In this new era of volatility, it’s not enough to be financially cautious—we need to be financially resilient. Nimble. Durable. Smart.
So how do we prepare for a future we can’t predict?
1. Emergency Funds: A Necessity, Not a Luxury
These are no longer the luxury that we can build up slowly and keep for a rainy day that may or may not come. They are essential for our survival in many circumstances. With the recent war with Iran that caused widespread damage, many people are now facing major property losses that are only partially being covered by the state. Emergency savings of 3 to 6 months of income can help you and your family to survive and thrive through the new reality of constant change. It will provide the stability to take time off of work, to help family, care for children, change jobs, without needing to stress how to put bread on the table.
2. Reassess Your Budget
Take a new look at your budget – or create one if you don’t yet have one in place. Reassess what constitutes the essentials and what doesn’t make the cut. You want to create a new reality where you can save 20% of your salary towards your emergency fund and long-term flexibility. Ignore all the assumptions that you may have made. Take a step back and look at your life and its priorities from a brand-new vantage point. Go back to the basics and work up from there, tracking your expenses carefully to avoid surprises. Unlike most of what we are living through, our spending is one of the few things that we can control.
3. Diversify Your Income Streams
I have written before about the value of creating multiple income streams to build wealth. Whereas that still stands true, today it might well be a case for survival. Everyone should look at their professions in our changing world and recognize that there might be shifts and instability that should be prepared for. The AI revolution is altering the way almost all sectors operate, and that will continue to have a direct impact on the employment market. Assess your abilities and be open to diversifying your income streams via unconnected professions if that matches your skillsets. In Israel, some sectors, such as tourism, have suffered five catastrophes in five years. If you are in that, or a related profession, you may well need to think of alternative sources of income. Don’t wait until a crisis forces your hand.
4. Be Cautious With Debt
Assess your debt situation and be extra careful about taking on new debt. It is very appealing when loans are offered with seemingly excellent conditions. But be very cautious. There are also some offers to freeze payments, which under certain circumstances can be very beneficial, although they can also be potentially disastrous if the interest then accumulates exponentially. Don’t rush into any financial commitment without assessing the long-term ramifications.
5. Re-Evaluate Your Housing Situation
They say your home is your castle. In Israel, I believe many people need to consider afresh where the best place is to set up shop. Many Israelis continue to live in homes without mamadim (safe rooms) and need to run to the local street-based bomb shelter. Given the new reality we have been living through for the last few years, many of us should re-evaluate our housing situation and challenge given assumptions of where we want to live, how large an apartment or house we can afford, the space we need to feel comfortable and whether our current home fits the bill. Take a serious look at whether downsizing or renting is an option to free up capital and give greater life flexibility.
6. Review Your Investment Portfolio
Your investment portfolio should reflect your needs and risk tolerance and should be diversified in a manner where certain asset classes gain strongly when others perform less well. However, with all the changes that are happening in our global village, ranging from pandemic, to wars to technology, now is a very good time to evaluate your portfolio, taking into consideration our changing reality. Are you overexposed in vulnerable sectors? Have global events changed the risk profile of certain assets? Are you underexposed or over exposed to the local stock market and currency and to stocks and/or bonds? If you aren’t able to do your due diligence, consult a professional.
At Labinsky Financial, we believe that true wealth is about more than just numbers – it’s about living meaningfully today while planning responsibly for tomorrow. We guide our clients in finding the balance between enjoying life’s moments and securing long-term financial health. Whether it’s reducing financial stress, gaining the freedom to pursue meaningful work, or aligning spending with personal values, our goal is to help you live well – both now and in the future.
The Bigger Picture
Despite everything we have been through, and continue to endure, we are living in miraculous times. Those of us privileged to live in Israel have witnessed awe-inspiring miracles, events that defy all the odds, despite the loss and suffering that surrounds us.
It is impossible not to feel the presence of G-d’s hand guiding us through.
However, as we continue to pray for the safe return of our hostages, the protection of our soldiers, and the security of our nation, we must also take practical steps to strengthen ourselves and our families. Financial resilience is not separate from spiritual strength—it’s one more way we bring stability and hope into an uncertain world.
May we all be worthy of G-d’s continued protection and blessing as we navigate the road ahead, together.
With continued prayers for the safe return of all of our hostages, the safety of our soldiers in all their missions, and the security of our nation.