Here Are 10 Ways That You Can Prepare For A Financial Emergency
A financial emergency can leave you in a jam, and unfortunately, there are all kinds of issues that can crop up and cost you a big chunk of change, including:
- Health problems
- Home repairs
- Car issues
- Loss of income
- Pet illness
If you've just experienced a financial emergency, here are 10 ways to deal with it.
1. Emergency Fund
The best option for handling a financial emergency is definitely
an emergency fund. When you've saved up money for any potential worst-case scenarios, you can weather the storm without going into debt. The usual recommendation for an emergency fund is to save three to six months' worth of living expenses, but you can start with smaller milestones, such as $500 and $1,000.
2. Credit Cards
A credit card is a convenient solution for a sudden emergency, and you typically won't start accruing interest until at least 30 to 45 days after you've put the charge on your card.
There are 0-percent annual percentage rate (APR) credit cards that can allow you to finance your emergency interest-free for an introductory period, and rewards credit cards will even earn you a return on what you spend.
3. Ask Friends or Family for Help
It's hard to ask people for help, as you need to swallow your pride to do it, but it can also be an inexpensive way to get the money you need. Your friends and family may be willing to loan you money without charging you any interest on it. Just make sure you pay them back in a timely fashion and don't take advantage of their good nature.
4. Personal Loans
There are plenty of options out there for personal loans – you could go to a bank or credit union, try an online lender or check out peer-to-peer (P2P) loans. Approval criteria vary from lender to lender, but personal loans are often available with low interest rates, making them an affordable option.
5. Title Loans
If you need a fast, convenient loan option, then it's time to look into
Texas title loan lenders. All you need is a car with title in your name and no liens on it. If you meet that requirement, you're all clear to get a title loan up to a portion of your car's value. For
Texas car title loan help, check out more of our site, including the FAQs, or click the
apply link.
6. Payday Loans
Payday loans are another fast loan, and this type of loan typically only requires you to have consistent income. These are short-term loans, and the most common term length is two weeks, which means they're best for when you just need a quick financial boost.
7. Sell Some Belongings
If you have some extra items that you really don't need anymore, try selling them to raise the money you need. Craigslist is a good option for this, as are eBay, OfferUp and the many other online marketplaces out there. The only potential downside of this method is that it can take some time to sell your items.
8. Borrow from Your 401(k)
If you've been diligently paying into a 401(k) for years, you may be able to borrow from it to pay for your emergency. This will depend on how your 401(k) is setup, but the good news is that you shouldn't face any financial or tax penalties for doing this.
9. Get an Advance from Your Employer
Like borrowing money from people you know, this also requires you to swallow your pride. It's no fun asking your boss if they can give you an advance on your pay, but if you have a good relationship with them, it may be worth giving it a try. Most employers would be open to helping an employee in need, especially if you've done a good job for them.
10. Find Another Source of Income
Try to think of some other avenues you have to earn quick extra cash. You could try driving people around for a Saturday night as an Uber driver, or deliver products through Postmates. Check the labor section on Craigslist, or go on freelancer sites to see if there are jobs that fit your skill set.
There are many ways to get the money you need for a financial emergency. Look over the options above and see which of them best fit your situation.
