Pages Navigation Menu

Everything Personal Finance

Coping with a Financial Emergency

Image source

Just been hit by an unexpected financial emergency and you’re starting to panic because you don’t know how you’re going to get through? Whether you’ve lost your job, been hit with a huge medical bill or your home is crumbling around you, panicking won’t help. What will help is taking control of the situation right now…

Evaluate the Emergency

Before you do anything else, sit down and think about what the problem is, how it was caused and what you need to do to either fix it or minimize its impact. This is a much better way to deal with the situation than panicking, and it will help you to choose the right path to get you out of your mess.

Work Out Your Most Important Expenses

When you’re suffering a financial emergency, you should always look at all of your outgoings and determine which bills are most important. Things like medical bills, mortgage payments and crucial work on your house should always go before anything else. If you have to cut your cable or you miss an electric bill, it won’t end up with you losing your life or your home, so be sensible. It might not be much fun, but it will help to keep your head above water.

Negotiate

If you’re in an emergency situation then you might just have to swallow your pride and call up your lenders and the companies you owe money to and explain what has happened, asking them if they will allow you to extend your payment terms or freeze your interest, so that you don’t have to worry about angry phone calls and repo men.

Find More Money

Sure, I hear you say, it’s just that simple! Of course it isn’t, but if you’re in dire straits because you were injured at work, then the lawyers at SeveyDonahueTalcott.com might be able to recover enough compensation for you to pay those urgent medical bills, for example, or if you’ve been laid off you might be able to claim welfare, and if you have a 401(k) you could take a loan from your account. You might even be able to convince your family to lend you the cash you need to get through this rough period you’ve found yourself in. Sure, you might not want to, but needs must, and it’s better than being left with nothing.

Start an Emergency Fund

Now that you know what it’s like to experience a financial emergency, it’s a good time to start thinking about setting up an emergency fund with the help of lifehacker.com/emergency. Sure, you might not have anything to spare right now, but every little helps and as soon as you start to recover, you should start saving so that it doesn’t happen again, or at least, so it doesn’t impact you quite so badly next time there’s a financial emergency.

Get Insurance

For similar reasons, you should, when you’re back on your feet, insure your life for as many emergencies as you can possibly afford. That will give you a better safety net.

Financial emergencies can be difficult to handle, but if you keep your head and you take this advice, it doesn’t have to be a disaster.