3 Ways That You Can Handle an Emergency Expense

Emergency Expenses

It’s always wise to plan for the worst — especially when the worst comes with a hefty price-tag. So, find out what you can do to handle an emergency expense that doesn’t fit inside of your regular budget. These are three options:

1. Emergency Fund

An emergency fund is always a good financial safety net. You can dip into these savings whenever an unexpected cost crops up, and you won’t have to worry about impacting your monthly budget or managing future repayments.

One problem that comes with emergency funds is that they take time to build up. Financial experts recommend that you try to put at least three to six months’ worth of expenses inside of your fund so that you can cover a whole host of emergencies, including medical problems and job loss. That will take years to accomplish.

Starting an emergency fund might not help you right now. But it can help you in the future.

2. Line of Credit

A personal line of credit is also a sensible safety net. It’s a credit account that you can draw from when you need to cover an expense that you otherwise wouldn’t be able to afford.

A personal line of credit can be useful when your budget is too tight, or your savings account is too low to cover an emergency expense. You can just draw a specific sum from the line of credit and have it deposited into your bank account. There’s no need to put a problem on hold. You can pay for it right away and then manage repayments later on.

If you’re considering applying for a line of credit to help you handle emergency expenses, you should visit to learn how they work and what qualifications you need to apply for one. You could be eligible to get one quickly.

3. Borrow from a Friend

You can’t really plan to borrow from a friend ahead of time, but you can gauge what friend would be the best person to ask for help in the case of an emergency. You will want to ask someone who you have a strong connection with and who is financially stable. It’s unfair to ask a friend who is struggling to make ends meet to lend you cash.

You should know that there is a major risk when it comes to borrowing money from friends and family members. If you don’t pay them back properly, you could ruin your bond with them from this point forward. A survey by Bankrate found that almost half of adults had damaged relationships because they gave friends money and didn’t get repaid in the way that they’d hoped.

So, make sure to ask the right person when borrowing money. Pick an amount that you can repay in a sensible amount of time. Take the repayment seriously and show your friend appreciation for the loan. Otherwise, covering an emergency cost could come with a big loss.

It’s possible that you won’t encounter any emergency expenses that won’t fit in your budget, but are you really willing to take that chance? It’s always better to be safe than sorry.

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Nirupama Verma is a self passionate blogger, managing a bunch of informational blogs. She has written a lot of informational content for several popular blogs.

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