How to Avoid a Financial Emergency
Nobody wants to think about it, but financial emergencies can happen to anyone. If you’re not prepared, they can quickly spiral out of control and cause a lot of damage. Before that happens, read on for some tips on how to avoid a financial emergency and stay on top of your finances!
1) Make a budget and stick to it
Creating and sticking to a budget is one of the best ways to avoid a financial emergency. With a budget, you’re able to determine how much money you have coming in as well as what expenses you need to cover. This way, you won’t be spending more than what you can afford.
The best way to get started when making a budget is by calculating your total income and dividing it into categories such as rent or mortgage payments, utilities, food, entertainment, and savings. Once you have all of this information laid out before you, then it’ll be easier for you to decide how much money should go into each category based on what’s most important for your finances.
It’s also wise to leave yourself some wiggle room in your budget for unexpected expenses or emergencies that may come up. Utilize this additional money wisely and don’t use it on unnecessary items or activities that could put you further over budget. In addition, try not to tempt yourself with too many “luxury items” that are unnecessary for day-to-day living.
2) Don’t fall behind on bills and payments
Another way to avoid a financial emergency is by making sure that all of your bills and payments are up-to-date. Falling behind on any kind of payment can lead to additional fees, interest, or even worse — debt. It’s best to be proactive when it comes to paying your bills, so make sure that you’re always keeping an eye out for due dates and create reminders for yourself if needed.
If you find yourself falling behind on payments, don’t panic! Contact the company as soon as possible to discuss available options such as deferment or reduced rates. Additionally, if you need help with budgeting or managing money more effectively, consider talking with a financial planner, who can help you find ways to keep up with your payments and stay on track.
3) Get a lawyer if debt collectors come calling
If you’re already in the midst of a financial emergency, and debt collectors are coming after you, it’s best to get a lawyer. Debt collectors tend to be very aggressive in their pursuit of payments, so having legal representation can help protect your rights and ensure that any agreement made is fair. It could also help to have a slip and fall attorney if you’re ever injured at work or in a public place so you can be sure you’ll have someone fighting the good fight for you while you’re working on recovering.
No one ever plans for an unexpected financial emergency, so by following these tips you’ll hopefully be able to avoid them in the future. Keep a close eye on your finances, create and stick to a budget, don’t fall behind on payments, and cut back on expenses whenever possible. Doing this will ensure that you’re in a much better position to handle any financial surprises that come your way.