We’d like to think that we’re prepared for any kind of financial challenge that comes our way. But the fact is, sometimes we’re not. If you find yourself in this predicament right now, there are some things you can do to dig yourself out of trouble. Some of the steps are concrete. Some are more mental. All of them will help you regain your financial equilibrium. Here’s what you need to do.
Know What You’re Dealing With
An article on The Balance website suggests that you do this very thing before you do anything else. After all, all financial emergencies aren’t created equal. Case in point? Your furnace going out may not be the same kind of emergency as losing your job. Therefore, how you deal with these issues will be different in some cases. You may need a different plan to adequately deal with one as opposed to the other.
Avoid New Purchases
If the issue is small, then one step you might take is just to put off a purchase that you had planned for like a big screen TV. It’s not that you can never get the TV. It’s just that you have to pay for the emergency first. If you do wind up taking this step, The Digerati Life website suggests that you plan on putting the money back into savings as soon as you can. You can even take this step one step further by actually opening up a bank account for an emergency fund. A thousand or two is probably enough to cover most unexpected expenses of this type.
Borrow If You Have To
Sometimes, the emergency is so out of the blue (or you’re still recovering from the last emergency), that you’ll need to borrow money to get through. In this case, you might need to get an emergency loan from friends or relatives or even a short-term loan like a title loan. As with the situation above, just make sure that you have a system in place to pay back the money you’ve borrowed before you borrow it.
Take Steps Now to Avoid Problems Later
While revamping your budget may not help you out of this financial crisis, putting together a new budget can save you grief down the road. Very often, the most negative situations we experience bring about the most positive results in the end.
Saving for a rainy day isn’t always easy as an article on the Bankrate.com website acknowledges. That’s okay. Putting $50 a month may not make a big difference now in terms of your bottom line. However, not only will that money eventually add up, it’ll get you into the habit of saving even when you have no money.
Make Extra Money Somewhere
Some people find financial and emotional relief from getting a second job when times turn tough. Working a few shifts a week at a local restaurant or weekends at a hotel desk puts extra money in your pocket when you need it.
But it does something else that may be as important. It helps you restore your sense of self-worth. It’s not unusual for a person’s self-esteem to take a big nose dive when financial stresses hit. Getting a second job is one proactive way to counteract that.
How you deal with a financial emergency depends largely on what type of emergency it is. Repairing an appliance or a car, while unfortunate, may not have the same impact on your finances as a job loss or an illness will have. If you do hit a rough patch, don’t be afraid to get a loan or take on a second job for a time. These temporary measures will keep you afloat until you can get back on your feet.