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Financial setbacks inevitably happen, and if you find yourself dealing with a layoff, high medical expenses, or another setback, there are some steps you should take to start the road to recovery.

Assess your personal situation
First, assess the situation so that you know exactly what you are dealing with. Is this a one-time setback, or an ongoing issue? Is it temporary or permanent? Know exactly how much money you’ll need, and how much you have.

Analyze available financial resources
Determine what resources are available to you, both from your own accounts as well as insurance. If you are facing medical bills, have you made sure everything has been covered appropriately by insurance? If you’ve been laid off, look into Consolidated Omnibus Budget Reconciliation Act (COBRA) extended health insurance coverage, as well as unemployment insurance. Do you have an emergency fund? If so, this may be the right time to start using it. 
Set financial priorities
After you know exactly what your situation is and what resources you have available to you, you’ll need to set priorities. Go through your budget and determine if there is any opportunity to decrease costs, such as canceling or cutting back on cable.

Know which bills have to be paid immediately, and what things you can prioritize later. Just don’t be tempted to go without insurance – this can change a minor setback into a major one very quickly.

Create a personal financial plan
With your spouse, work through your budget and your bills, and decide how you are going to get everything paid. Is there opportunity to earn more or spend less? Know exactly how you’ll be spending your money over the next few months, and make a plan to track your progress.

Contact your creditors
Finally, if there are some bills you absolutely cannot afford to make minimum payments on, contact your creditors to work through payment options. You should make these phone calls before your bills end up in collections, because once there, your options are limited.