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Wise things to do when you’re running short of money

by on May 13, 2019 in Latest News, Lead Article, Nuggets

Wise things to do when you’re running short of money

Having a moment or two when we run out of cash whether as a result of an emergency or even the loss of a job is never easy.

If it’s a consistent problem, then it’s time to examine your budget against your income and make the necessary adjustments to prevent the income crisis from reoccurring.

Meanwhile, here are some few wise things to do when you’re running short of money:

1.  Take stock and prioritize your spending

Take a close look at your income, expenditure and debt. Separate all liabilities that are tied to collateral from the unsecured debts.

Which bills to pay first

Determine which bills you can let slide for a while from the ones that need urgent attention. The bills that impact significantly on your household’s health and security should be given the priority. These include:

  •  Income taxes

  •  Insurance

  •  Any secured loans

  •  Essential utilities like gas, water and electricity

  •  Mortgage payment

Although some of these are negotiable, paying the minimum on your credit card can help you get by for a while.

2.  Cut your existing bills

Any unnecessary bills in your budget should be ruthlessly struck out. Such expenditure may include gym memberships and other non-essentials.

Also, call your bank and wireless statements to negotiate better rates. Any bill can be reduced just by asking, and that could save you a few hundred dollars a year.

Cut your most expensive spending

Housing: The most significant expenditure goes to the house so it’s the first thing you should scrutinize and cut down on. Moving might not be an immediate option, but it’s something to consider down the line.

Transportation: Consider using public transportation instead of your car

Food: Minimize how much you spend on food. It’s possible to have a decent meal for less than two dollars a day. You could also shop at grocery stores with reduced prices to help you save a ton of money on food.

3.  Find alternative sources of income/cash

Selling the things you don’t need like old electronics and jewellery could earn you a couple of dollars. Regardless of whether you have a full-time job, side jobs for cash are another way of making extra legitimate cash on the side to supplement your regular job.

Finding temporary, work from local unemployment agencies could also be a good idea. You could even engage in tutoring, babysitting or running errands to help you stay afloat.

Explore loan options: Consider the borrowing options at your disposal. If you urgently need cash right away, you could talk to family or friends depending on how close you are to them and see if they can assist.

That should be the first option since there are risks and hefty fees associated with other types of loans. If you have excellent credit, peer-to-peer lending sites are likely to advance you a loan at a decent rate.

Seek government/non-profit assistance: Beyond food stamps and unemployment insurance, also remember that there are government programs that could help you get back on track financially.

Though bankruptcy is a last resort that could clear you of many debts, it’s not a solution to solving all your problems, so always be cautious when considering it.

Running out of cash now and then could mean that you’re either not sticking to your budget or not planning well.

Fixing the underlying problem will help you avoid accumulating more debt than you can pay off.

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