HOW TO HANDLE FINANCIAL EMERGENCIES?
Emergencies are tricky situations. We sometimes hit a sharp curve in the journey of life, which often may seem like a dead -end. But we may be better at handling such situations if we just stay prepared with a good navigating system, which essentially refers to a positive attitude and some supporting elements such as our loved ones and financial aid.
Sorting out your finance is actually the easy part, so let’s begin with that
1. Sudden Medical Expenses
These are the most common yet most stressful situations. But to make this a little easier you can follow a few simple steps.
(i) Figure out how many days of leave you may require for recovery from your doctor, and contact your employer. Explain the situation to them and understand how you can avail you leave. Sometimes, there may be a loss of pay or not, and knowing this in advance, will work to your advantage later.
(ii) Once you sort your leaves out, understand if you have any insurance coverage or deductibles you can avail from your company. Some companies also offer compensation for certain medical situations. This can easily be overlooked by us when we sign our employment contracts. So always enquire and be aware of your benefits.
(iii) The next step is to avail of your health insurance. If you don’t have one, you should really consider getting one, as medical insurance relieves you from a number of expenses during emergencies.
(iv) If you are required to take medications, you could consciously enquire and consider buying generic brands alternatives. These tend to be the exact copy of a more expensive brand-name medication. Your doctor will suggest the best alternatives.
2. Job Loss
Another very common emergency is a job loss! We’re often left jittery when we do not have a source of income. But the first thing you must do is organize your thoughts and expenses. Remember to prioritize and spend only on things that are important. It is a good time to cut down on your wants, and focus on your needs. Another important thing you can do is to reach out to your service providers such as your credit card providers, phone services, etc. and switch to more efficient packages. If you have any debts, they often provide financial assistance to you during emergencies such as these as well. Try to avoid late payments during these times especially, as it often creates more chaos in the long run.
It’s important to remember that a job loss or switch is something everyone goes through at some point, and don’t panic! It’s only going to be a little while before you find yourself in a newer and perhaps more exciting environment!
3. Repair & Maintenance
If you live by yourself, or if you own a vehicle, chances are that you come across this situation quite frequently. A leaking tap, a broken oven, or an engine failure are all part and parcel of adulting. Usually, the faster you fix it, the lesser it is going to cost you to fix it. Do not wait until the entire machinery goes bust! Also, there are insurances available on your homes and vehicles as well. Insurance is also a good way to combat such emergencies.
It’s important to remember, regular servicing of your equipment or vehicles, and cleaning out your home often keeps them in check. This way you will not only save money, but you will also reduce the frequency of such emergencies happening!
4. Debts & Loans
We all often have to resort to loans in order to make our dreams come true, such as home loans and student loans, but these are usually planned. Sometimes, we may also have to take loans during medical or other such emergency situations. It’s absolutely okay for us to seek financial support in such circumstances, but the key is to repay them on time. When you take a loan, make sure you work out the finances for repaying it.
No matter what the situation may be, always make timely payments, which not just has a great effect on your credit score, but it also reduces your worries! When you plan your finances, paying off your loans and debts must be first on your list!
Keeping these tips in mind, you are bound to handle your emergencies more efficiently than before. But the ideal thing to do is to try and set up an emergency fund. An emergency fund always has our back in bad situations and comes in handy when we are at wit’s end.
And always remember – It’s better late than never! So go ahead and start saving up for your emergency fund today!