What Can You Do During a Financial Crisis Instead of Freaking Out?
When you need to make changes to your financial plans in life, it is incredibly stressful. This happens during times of financial emergencies. These can be sudden cutbacks at work, the time between jobs and period after a big buy. Anyhow, these are situations that you need to deal with actively. The problem is – only a few of us do so.
Why do we end up panicking during financial crises?
- We do everything else other than focus on the problem in hand. These distractions make the situation worse.
- We don’t stop spending via credit cards. We keep making bad buying choices.
- We waste time and let the problem fester. We do not come up with any effective solution.
- We do not have access to expert advice. Counseling is very necessary during financial challenges. You need to know how to reconstruct your expenses and make way for savings.
- We end up spending our savings without finding ways to earn.
These are a few practices that make financially desperate times more difficult for the most of us. However, this need not be the reality for you as well.
Try doing this instead –
If you are going through a tough time economically, you can follow the steps mentioned below for an immediate respite –
- Assess your savings
This should be the first step for any adult going through a phase of unemployment, sudden fiscal stress or medical emergencies. Find out how much you have in your bank accounts. Do you have anything else stowed away for emergencies like these? Do you have any investments that you can access? If you are in serious trouble, do not shy away from getting your gems and jewelry evaluated as well. Find out how much your home is worth right now and if it will help to move to a smaller apartment. Always remember to write these values down on a notepad. That way, you will always have a practical idea of how much you have saved.
- Prioritize your expenses
You need to pay your electricity bills and your utility bills. You must count this do not every month. Then comes the installment charges for your appliances, mortgage payments, vehicle loans and other loans. If you have credit card loans, make sure you start off paying at least once. This may sound crazy during times of economic catastrophes, but having credit card debts and interest rates looming on your existence is more stressful than any other financial challenge. So pay off the one with the highest interest rate.
- Debt counselling
If you cannot figure out a way to prioritize your expenses and pay off bills at the same time, do not be shy to ask for expert help. During tough times, this may sound like an added burden, but this may be a saving grace for your family savings. A debt counselor will be able to guide you in the right direction. Sometimes, you need expert judgment to deal with multiple debts. If you have multiple credit card debts, find a debt counselor right away!
- Consolidate your loans
Dealing with a thousand problems is bound to create more problems. So, when you get the chance utilize it and consolidate your problems. You can coalesce all your outstanding loans into one. After consolidating, you can forget all about calculating different installment amounts and their interests. You can forget all about scheduling. So, you should set reminders on your phone for paying the EMIs. The consolidated loan will make sure that you need to pay just one amount every month to the consolidation loan company. All other payments become the responsibility of the company itself.
- Devise a strategy
Now that you have expert help, you can chalk out a plan that will assist you with repayment of loans. You can not only successfully pay off all your creditors and say goodbye to financial nightmares, but you can also find ways to save. This may sound too utopic right now from the place you are standing, but it is possible. Once you get your payments and expenses in order, you can accurately estimate how much you are spending every month and how much you can save from your monthly income.
- Sell what you don’t need
eBay and Craigslist are excellent options for people who want to sell off second-hand stuff they do not need. Is there a guitar you do not use anymore? Do you have an antique chinaware collection that your great grandmother gave you? Is there more junk just sitting in your garage, basement and attic? You see nostalgic ties, while they are an easy source of money sitting and collecting dust. This is the kind of action everyone in financial crisis needs to take to knock down the first debt.
- Take out a title loan
This is practically asking for money you already have. If you own a vehicle or a motorcycle, you can quickly take out a title loan. However, make sure you are going to a trusted company for this one. Title loans should be around 75% of the current value of your vehicle. Many times, people are stuck on a treadmill of loans since the APRs are too high. A good company like the Bay Area Title Loans always discusses other loan options with your first before proceeding with a title loan.
You will get a detailed walkthrough of the loan sanctioning process, the fees involved and the repayment terms before you sign anything officially. This is a handy solution for some “quick cash.” If you want a long-term solution to your financial trouble, we do not suggest title loans as an option. A long-term solution requires detailed discussions like the kind offered during debt counseling.
Dealing with financial stress is not easy. Sometimes it becomes more difficult because we end up facing it alone. It does not have to be that lonely and painful anymore. If you are going through a financially tough time, give https://bayareatitleloans.com/ a call. Our debt counselors will reach out to you for a realistic evaluation and assessment session.