Financial resilience provides a safety net that you might rarely use — but when you need it, you’ll be glad you have it.

“A household is financially resilient if they are prepared to encounter unexpected financial shocks,” says Emerson Sprick, associate director of economic policy at the Bipartisan Policy Center, a think tank in Washington, D.C.

Shocks could include costs like a surprise medical bill or home repairs or lost income from a layoff. They tend to be “unpredictable in their timing, but we generally know they will happen throughout our lives,” Sprick adds.

Given that we’re all likely to face financial shocks at some point, here are some ways to improve your financial resilience.

LOCK DOWN YOUR CASH FLOW

“Sometimes, we go out and spend without thinking,” says Troy Anthony Anderson, who develops financial education extension programs for the University of Maryland in Calvert County. That’s why he recommends writing down expenses to track exactly where money is going as a first step toward figuring out what to cut, such as going out to eat or to the movies.

Anderson suggests planning for the entire month so you don’t overspend each time you get paid. “Ask yourself, ‘Do I really need to eat like a king or queen when I get my paycheck?’ The direct deposit clears and you go to Texas Roadhouse or Outback, but then the following week (you) have no money and have to make peanut butter and jelly,” he says.

To stay on track, Anderson keeps a limited amount of cash in his wallet for discretionary expenses and writes down what it can be used for on a sticky note that stays with the cash.

CREATE A SAVINGS RESERVE

While building up the traditionally recommended three to six months’ worth of expenses is out of reach for many people, it’s worth striving for some savings, says Kate Bulger, vice president of business development for the nonprofit financial counseling and educational organization Money Management International.

“The more we can save the better, and having that savings gives people the runway they need” to get through a difficult time, she says. Keeping those savings in a high-yield savings account can allow the money to grow over time while staying safe.

In addition, retirement savings can bolster long-term financial resilience, Sprick says. Many workers can leverage employer matches and tax-advantaged accounts such as 401(k)s to help build savings for retirement. Contributing even a small amount each pay period can lead to significant savings over years of working, especially when the money is compounding.

DEFEND YOUR CREDIT

Keeping credit card balances as low as possible can leave those credit lines available for emergencies, Bulger says. “Credit cards are a great tool to use for short-lasting hard times. Having room on your credit cards lets you use them that way,” she says. Then, paying off the balance as soon as you can helps keep interest to a minimum.

Otherwise, Sprick warns that it’s easy to get caught up in “a pernicious cycle of debt and poverty.” For example, if you have to put a $300 car repair bill on a credit card that charges 20% interest, you’ll be charged about $5 in interest per billing cycle until you pay it down.

“Especially right now, with interest rates as high as they are, it’s easy to get caught in a cycle of debt where you never get out,” Sprick says.

TALK THROUGH YOUR FINANCIAL PRIORITIES

Discussing with family members how you would handle a financial shock before one actually happens can help you prepare for that moment, Bulger says. She suggests the following prompts:

— What are the most important things in our financial life?

— What are we saving for?

— What expenses will we cut out first if we need to?

“If you have that conversation ahead of time, it’s easier to make the adjustments,” Bulger says.

At the same time, talking through financial challenges with family and friends can help you feel emotionally supported. “Financial hardships can be incredibly lonely even though we know many people are going through financial strain,” Bulger adds.

LEAN ON YOUR COMMUNITY

Communities often have food banks, government programs and school-based aid that can help people going through a difficult period, Bulger says. She also suggests turning to other resources, such as a nonprofit financial counselor or online budgeting how-to videos to help support you through changes in your saving and spending habits.

However you seek support, try not to dwell on setbacks. Daniel Milan, managing partner at Cornerstone Financial Services in Southfield, Michigan, suggests that just like with the stock market, it can help to focus on down the road instead of what’s right in front of you.

“We can’t control the day to day, but if you have a plan over the long term, history has shown us that your average over time will work out,” he says.

Sometimes, you just have to get over the dip.

This column was provided to The Associated Press by the personal finance website NerdWallet. The content is for educational and informational purposes and does not constitute investment advice.

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Kimberly Palmer is a personal finance expert at NerdWallet and the author of “Smart Mom, Rich Mom.” Email: kpalmer@nerdwallet.com. X: @KimberlyPalmer.

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