Do you have all of the bases covered when it comes to your income and your expenses? Even if you’re the type of person who constantly saves money, there might be some things that you haven’t prepared for.
In the event that you struggle financially and you are experiencing some financial crisis, what are you going to do?
In this article, I will go over some strategies that you can do to help you in times of a financial crisis.
Create a Plan
Before doing anything, you need to come up with a plan. When you do something in life that involves a lot of things, it is best that you come up with a blueprint to solve it. Assess your current options. How much money do you need? How much cash have you saved in your emergency fund (if you have one)? Do you have prior debts that you need to pay in the next couple of months or some things that are considered urgent?
Write those things down and make sure to rank them according to priority. Since you only have a little money to spare, paying for the things that are the most important should come first.
Determine Your Income and Expense
Now that you’ve assessed your current options, the next thing that you should do is to determine how much cash you currently have and what your expenses are going to be in the coming weeks and months.
I think you already know where I am getting at. You need to learn how to budget your money properly so that you can eke out every last cent.
The way you do this is to list all of your expenses and ranking them, again, according to priority.
For example, utility bills and certain debts should come first. Next will be your groceries and food expenses. The last thing would be for entertainment and leisure.
If you are experiencing a financial crisis, it is best that you ditch your entertainment and leisure, for now. If it cannot be helped, just apportion a small budget for it, otherwise, leave it.
Ask for Help from Friends and Family
In times such as a financial crisis, the very first people that you should go to for help are your friends and family.
This can be a hard thing to do, especially if you’re accustomed to doing things on your own. The thing is, if you just borrow the money that you need in a good way, then there is really never going to be a problem with that.
To appease your friends and family that you’re going to pay at the soonest possible time, make a formal letter signed by both parties.
Also, ask them if they can give you ample time to pay and if you can borrow as much cash as you need for the time being. Remember, only get from them the money that you actually need to pay for the important things and not for your leisurely expenses.
Alternative Financing Option
After going over the above options and you still find yourself lacking the necessary funds, what are you going to do?Well, there are actually some pretty good ones left for you. For starters, you can get a personal loan which is what most people would do in the event that they need cash.
However, getting a personal loan can be tricky, especially for someone who does not have a good credit score.
If your credit score is not good (below 600), then I recommend going for an auto title loan instead. You just have to make sure that you have the title of the car.
Most lenders would inspect the car, although, there are some that would just allow you to send pictures to the lender and that’s it.
A cash advance is another suitable option but only do so as a last resort because of the high-interest rates.
You may experience a financial crisis at some point in your lives. In the event that you are in one, make sure to always create a plan of action, determine your income and how much money you have in your account, asking from friends and family sure won’t hurt, and going for some alternative financing solutions are also great options to help you solve your money problem.