Sometimes life takes an unexpected twist or turn, and you can be in a situation where you need money fast. Whether it’s a family emergency, job loss, car repair, vet’s bill or boiler breakdown . . . there is an issue to fix and the only way to do this is to throw money at it.
The problem is that these kinds of situations for some reason tend to happen when money is really tight anyway. So how are you supposed to find yet more money to sort everything out?
In this article we look at five steps to take in a financial emergency.
The initial reaction of most people when faced with any kind of financial emergency is to panic. This is perfectly understandable, but it’s important to do everything you can to calm down. Only then will you be able to make a realistic assessment of how urgent the situation is, and whether it is something that you have to sort out on your own or if others may be able to help.
After the initial shock has worn off, you need to work out exactly how much extra money you need to sort out the situation. For example, do you have any savings that you could put towards it? Or if it’s a domestic appliance is there any kind of warranty or breakdown plan in place? Or for vet’s bills, do you have pet insurance that might cover at least part of the cost, and hopefully pay it up front?
Think carefully about whether any of these options apply to your situation, so you know how much extra money you actually need to find.
Once you know the amount of money you need to find, there are various sources to try for help. Some of these are:
It can feel awkward to ask for help from family and friends, but this might be an option worth considering, particularly if you are only going to need the extra money for a short period of time. But if anyone is willing and able to lend you some money, the key thing is to pay it back in full as soon as you can without them having to remind you. Otherwise it could possibly lead to a rift in the relationship.
Even if you are already receiving any kind of benefits, you may be able to get additional support. For example if you are on Universal Credit, there is a Budgeting Advance scheme which is designed to help cover situations such as replacing appliances, unexpected bills, home repairs or funeral expenses.
If you are on other benefits such as Income Support, Income-based Jobseeker’s Allowance, Income-related Employment and Support Allowance or Pension Credit, there is a similar scheme called the Budget Loan scheme which may be able to help.
The problem with the above two sources of help is that they can take a bit of time to organise. So if you are in urgent need of money for your financial emergency you may want to consider an emergency loan.
Look for a lender that offers loans same day so that you will be able to get your money immediately and start sorting out your financial emergency as soon as possible .
Once your financial emergency is sorted, it’s also important to make a plan for getting back on track financially again, particularly if you have taken out a loan to help you through. Make sure that you keep up with the loan repayments to get your finances clear as soon as you can.
If possible, try to repay your loan early. Check the terms and conditions of the loan to make sure you will not be penalised for doing this, as some lenders charge for early repayment. However, Munzee’s Same Day Loans have a normal repayment period of 24 months but you would not be charged anything for repaying it any time before 24 months, and would only be charged interest for the time you had the loan.
Once things settle down financially, it’s a really good idea to start building an emergency fund. Currently around a third of adults in the UK have either no savings at all, or less than £1,000 in a savings account. But financial experts recommend having savings to cover at least three months living expenses.
So, both as a financial buffer and to provide for future emergencies, now is the time to start building savings. Even if you just start by putting aside a very small amount of money each month into a separate savings account, then adding more to it whenever you are able, your savings will gradually grow. And in the case of any future financial emergency there will be at least some funds there to help you get through it.
We hope that this article has helped you to think about what you would do if you were faced with any kind of financial emergency. If you are currently in a financial emergency and need urgent help, check out Munzee’s Same Day Loans to see how we could help.
Check back here soon for more lifestyle and financial tips from Munzee Loans.
Five steps you can take in a financial emergency