No one can predict when an emergency will occur, but by being proactive and having a solid financial plan in place, you can ensure that you have the resources you need to get through a tough time. Here are six smart ways to ensure financial help in the case of an emergency in Arizona.
Getting a Title Loan
Whether you need money for a medical emergency or your car breaks down, the first thing to do is see if you can get a loan. You can look into getting a bank or credit union loan, borrowing from family or friends, or even getting a short-term payday advance. However, if you don’t have a good credit score, you might search for the best title loan company in Tucson to get the money you need. Loan companies are overlooking bad credit if you have a good means of returning the money according to your contract. If you need the money only for an emergency and plan to pay it off quickly, they’ll be more likely to give your application a chance.
Home Equity Loan or Line of Credit
If you own your home, whether it’s paid off or not, getting a loan against the equity in your house is another way to get quick cash during an emergency. The interest rate may be higher than a car title loan, but the period may be longer as well. In most cases, you can borrow up to 80% of your home’s equity.
Since you have to own your house to get this type of loan, this is another good option if you’re prepared to pay it back quickly. Otherwise, this could be a more expensive way to borrow money.
If you have bad credit, applying for credit cards during an emergency could be the best option available to you. You may have to pay a high-interest rate, but you’ll at least get the cash you need. In some cases, if you’re approved for a credit card with bad credit, the card company will give you your money almost immediately.
In many cases, it makes sense to pay off your credit cards in full every month so that the debt never has a chance to grow. However, in the case of an emergency, you may not have much choice but to use your cards and pay them back later.
Automate Your Savings
One of the smartest ways to ensure financial help in the case of an emergency is to automatically save a portion of your income on a weekly or monthly basis. By diverting money into an account that you can’t easily get to, you prevent yourself from dipping into that savings during times when it’s not necessary.
While setting up your savings this way won’t be helpful in every emergency, you’ll have the money you need to pay for any medical issue or car repairs. You can always use it for something else later, but at least the funds are there when they’re most needed.
Emergency Savings Account
Another option is to set up an emergency savings account and keep it separate from your other savings goals. Whether you want to save for a new computer, vacation, or anything else, an emergency fund can help you avoid racking up debt or using your credit cards during a time of crisis.
Start small if you need to and add more money as you can spare it. Over time, this money can really add up and help you get through a serious problem.
Life Insurance Policies
If you have a family, taking out a life insurance policy to ensure financial help in the case of an emergency is something to consider. A life insurance policy provides money to your loved ones when you pass away. While this may not be necessary for everyone, it can relieve some of the stress during difficult times.
Also, you can choose a policy that pays out a specific amount, such as $500,000, instead of choosing one that gives your beneficiaries the option to collect smaller amounts over time. This way you’ll know that your family is taken care of and won’t have to worry about saving up for expensive medical treatments or funeral expenses.
Depending on how much coverage you need, it can also help pay off any debts you leave behind.
Regardless of the reasons behind an emergency and how much money you need to get through that crisis, each of these six options can help you get through it without too much trouble. However, before taking out any loans against your car or property, make sure you’re prepared to pay the money back later with interest.