You never know when a financial disaster - job loss, illness or natural disaster - will occur. But you can take some simple steps to prepare, just in case.
It's hard to survive financially in today's fast-paced life. With mortgages, car records, and large amounts of credit card debt, most people struggle to survive month after month. With the majority of people doing what they can just to pay their bills, few people are prepared for the event of an unlikely financial disaster. They come in various forms; a hurricane like Hurricane Katrina, a job loss, or a sudden illness can destroy anyone who isn't prepared for the unexpected in their financial life. But it is not very difficult to make preparations that will help you in times of financial crisis. All it takes is a little planning beforehand.
Here are a few things that will help you prepare for the unexpected:
Have an ATM/Debit card - You may not regularly use cash or need a debit card, but there are some situations where it might be needed. People from New Orleans who were temporarily displaced by Hurricane Katrina will benefit from having access to cash especially when away from home. If you do not use it regularly, always have it and store it in a convenient place.
Sign up for direct deposit- With direct deposit, you will know that your earnings will be in your bank account even though you cannot, for whatever reason, physically reach your bank. This will help you if there is an illness or natural disaster that might make your local bank temporarily closed.
Sign up for online bill payment- You can pay bills especially if you are not at home via the Internet. You don't have to use this service, but it can be useful when you least expect it.
Save on emergency cash - Financial experts recommend that you save on financial expenses for at least 3 months. It's hard, but every little bit helps. Try cutting out some unnecessary items, like the big latte you buy every day. It increases, and you never know when you might need to access that emergency cash.
Controlling a home equity line of credit – Unlike a home equity loan, which gives you some quick cash, a home equity line of credit gives you cash that you can use little by little, and only when you need it. If you don't actually take the money, you don't have a monthly payment. But if an emergency strikes, you will have cash. This can be especially helpful if you are out of work for a short period of time. Your bank won't lend you money when you're not working, so plan ahead and the money will be ready when you're unemployed.
A little planning can go a long way when a financial emergency strikes. If you plan now, you will have less worries later.