Having an emergency fund for at least three to six months of living expenses is ideal. But unfortunately, not everyone can set aside a stash of money. In reality, many people are only living from paycheck to paycheck. They often struggle when unexpected situations like a sudden medical bill or an urgent home and car repair show up.

But don’t worry if you find yourself in such circumstances. There are a lot of ways to cope, even without an emergency fund at your disposal. Below, we’ve compiled the best options you can look into when you need cash unexpectedly.

Personal Loans

Personal loans, also known as general purpose loans, are among the top options you can choose for relief when faced with unexpected expenses. However, the amount you can borrow is often limited to between $1,000 and $50,000. Make sure to determine how much you need before taking out this type of loan.

Interest rates on personal loans depend on several factors, such as your credit score, loan amount, and the repayment period. Higher credit scores and shorter repayment periods typically result in lower interest rates.

Although you can usually utilize personal loans at your discretion, some lenders put restrictions on what you can do with the money. That’s why it’s always best to shop around with reputable online lenders like Creditninja.comto find the one that best suits your specific needs and budget.

Pawn Loans

Pawn loans don’t rely on your credit history. They are a good option if you don’t have an income source or a stellar credit score. All you need is to bring a valuable item to a pawnshop. The pawnbroker will assess the value of the item and decide how much loan to offer you. Some of the common valuables you can pawn include jewelry, musical instruments, and electronics.

Although pawn loans can help you access quick cash, they are an expensive option. Plus, the repayment period of a pawn loan is usually between 30 to 90 days. Failing to repay it doesn’t have any bearing on your credit score. However, the pawnshop can sell your item to somebody else if you default on your loan.

Line of Credit

A line of creditis another useful solution to cover emergency expenses or cover for temporary cash flow problems. It’s typically a flexible loan that you can get from a financial institution. But unlike traditional loans, you have access to a predetermined amount of money any time you need it rather than receiving a lump sum.

The interest on a line of credit starts to accrue as soon as you borrow a certain amount. However, it’s worth noting that some lines of credit may come with an annual fee, and having higher credit scores can help you get a lower annual percentage rate. Keep in mind that lines of credit are not designed to be used for one-time purchases like houses or cars.

Additional Options To Consider

Taking out a loan or borrowing money is a fast way to get the cash you need to help manage unexpected expenses. However, there are other options you need to consider besides having to pay interest for a loan. The following can also help you stay the course when financial emergencies come up.

  • Reduce Discretionary Expenses. Taking a look at your budget and reviewing all your expenses are always important. But it’s even more vital when you need cash unexpectedly. You can cut down discretionary expenses like recreation and entertainment. While this will probably not be enough to pay off everything, it can help you to get started.
  • Sell Some Unused Items. If you have some unused items, you can sell them online. Unlike what obtained years ago, you don’t have to make yard sales. The process is much easier and convenient these days as you can now sell your items through e-commerce websites. It may not cover everything you need, but the amount you’ll earn will be a great help.
  • Look For A Part-Time Job. The more jobs you have, the more income you earn. There are many ways to earn extra income nowadays without going through traditional part-time jobs. You can participate in virtual paid groups online or get hired online as a virtual assistant, data encoder, or customer service representative.
  • Get Financial Advice. Having to cover expenses you didn’t expect can be frustrating, especially if they occur repeatedly. It wouldn’t hurt to get financial advice to avoid putting yourself in the same situation in the future.

Prepare For Unexpected Expenses

Unexpected expenses can happen at any time. Although there’s no way to predict when they will come, there are many ways to prepare for them. Loans are a great financial cushion during hard times. But they are only a temporary solution. Once you’ve got your unexpected expenses covered, it’s time to put your finances in order and build an emergency fund as quickly as you can.


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