Even the best-laid budgeting plans can come to a screeching halt when hit with a financial emergency. To protect yourself against a crumbling budget, it is important to equip yourself with the knowledge and tools to be able to weather any financial storm. Following are four ways to keep your household afloat during a financial emergency.
The Rainy-Day Fund
Financial guru Dave Ramsey has built a loyal following because of the expert advice he continues to provide to those people looking to get their finances on track. His patented baby steps are designed to get you to a place of financial freedom. The first step in the process is to build an emergency savings fund of $1,000. After your debt has been paid off, you can work on building an additional rainy-day fund of three to six months of household expenses.
While it can be difficult to swallow your pride and reach out to others for help, there are certain situations that necessitate such action. Social media and crowdfunding are a powerful combination when you’re facing a medical injury or another emergency that requires immediate action. Leveraging the power of the internet can lead to impressive results when done properly.
Although it is easier said than done, it is possible to find extra money in your budget by merely cutting expenses. The first thing that you need to do when facing a financial crisis is to take a long and hard look at your budget to find costs that you can cut. Cable television, a gym membership, that expensive latte habit and dining out are all obvious indulgences that can be slashed from a budget when you need to focus on meeting the basic needs of your family.
Find a Side Hustle
It is easier than ever to find a side hustle with the purpose of generating additional income. The first step is to brainstorm ways in which you can monetize any special skills that you may have. Perhaps you can tutor children in a subject that you have mastered. Or maybe your side hustle is as simple as driving for a rideshare service or selling unwanted items on eBay.
With a little creativity and a commitment to frugal living, you can find ways to get through nearly any financial storm. The important lesson is to then learn how to safeguard your finances against future potential pitfalls.
Living as a financially responsible individual will reduce your stress and lead to long-term happiness. Try reading these articles to learn more about personal finances:
- Feeling Overwhelmed by Debt? 3 Tips to Help
- 4 Principles of Personal Financial Responsibility
- Signs That It’s a Good Time to Refinance Your Home