Don’t Panic! 5 Ways to Handle a Cash CatastropheAnna Newell Jones
While there are many things you can do right in your financial life, there are just as many things that can go wrong. One major monkey wrench in your day can send you into a financial tailspin. So what do you do when you have a cash catastrophe and need money you don’t have right now? There are a few ideas you can consider that can keep you on financial track but still free up some of your money in emergency situations.
The one last resort option’ you should avoid when in need of cash is payday-type loans. You may get the money you need but it will cost you so much more money you don’t necessarily have. Payday loan can also start the vicious cycle of never ending debt you can’t climb out from under.
Here are 5 other ways to access cash you should consider first…
5 Ways to Handle a Cash Catastrophe 1 of 6
Click through for 5 ways to access cash...
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Offload Your Personal Items 2 of 6
Host a yard sale, visit a pawnshop, or find a consignment store to offload items around your home you do not need. Items in good condition are often hidden in closets and basements so take a day to go through the unwanted clutter to net you some extra cash in a pinch. Explore your online reselling options to gain a wider audience and more selling potential.
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Market Your Skills 3 of 6
If you are in need of additional income, try marketing your personal skills. Can you sew? Do you like kids? Good at gardening? Skills you possess are a great way to earn cash on the side for doing things you like to do. People lacking these skills will happily pay for your services to get the job done right.
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Find the Spare Change 4 of 6
People often throw their loose change in a number of places around their home. You may be surprise at how quickly that money adds up once it's been collected and wrapped. Don't forget to check in old purses and wallets, coat pockets, and boxes sitting in storage. Those long-forgotten change jars can be just what you need to make ends meet. It's also a great way to start an emergency savings fund to prevent catastrophes in the future.
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Borrow From Yourself 5 of 6
Depending on the severity of your financial crisis, you may be able to borrow the money you need from your own 401k account. This should be a last resort consideration when you need a larger sum of money and have no options for getting a personal loan. There are tax issues to consider and you will need to repay the money on a schedule so make sure to clarify the process before taking a loan.
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Call on Family 6 of 6
There is an old saying about never mixing money and family for good reason. If you must approach a family member or close friend for money, make sure to start out on the right foot to prevent things from ending badly. Draw up a legal contract holding you responsible for the amount and timeline for repayment. Give your loved one the confidence that you are going to make good on the loan and keep relationships intact.
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