Life is so uncertain that anything can happen at any given moment. An emergency can arise at any time, with absolutely no prior signs. It could be a medical emergency or some sudden damages to your property. Such situations are unpredictable and we are usually not prepared to deal with them.
anything can happen at any given moment. An emergency can arise at any time, with absolutely no prior signs. It could be a medical emergency or some sudden damages to your property. Such situations are unpredictable and we are usually not prepared to deal with them.
What if you run out of your emergency funds or your savings have been extinguished? You might need some financial help at the time of such a crisis. Anyone would get really stressed and take irrational decisions in such situations. But to really get out of a financial emergency, you need some smart financing.
What is smart financing?
Smart ways of managing your finances by taking the smart decisions can be termed as smart financing.
Here is a guide on how to smart finance.
Avoid Bad Loans
Any loan that you cannot pay back is considered to be a bad loan! So you must not opt for such a loan as it will lead to more financial crisis and damage your credit score.
Before any lender in the market provides you a loan, they check your credit score. If you’ve not paid your previous loans on time, then you probably have a bad credit score. A good credit score means you are eligible for a better loan for a higher amount, flexible interest rates and payback duration.
To prevent a bad credit score, you need to make sure that you only borrow what you can pay.
Avoid Loans with High-Interest
In an emergency, you may take up any loan that is available to you. Make sure you check the terms of the loans and go for one with a low-interest rate.
Always analyse your options before taking any loan as you’ve to be responsible enough to pay it back. There might be bank loans or payday loans available at low-interest rates but your credit card might charge a hefty rate. You should avoid using credit cards in such cases and go for low-interest rate loans.
Avoid Loans with Bad Terms
Loans have a lot of terms and conditions that vary depending on the lenders. When financing in an emergency, you should go through the terms of the loan carefully. You should make sure that the interest charged on your loan is not high.
These days, a lot of online websites are providing payday loans like PayDayMe. You can borrow money for a short term or long term and the loan usually gets approved within a business day.
During an emergency, you may turn to your
friends or family for help. Your friends and family might have their own
limitations, in terms of the amount of money they can lend, or for how long
they can lend.
It’s preferred to inquire about these conditions, form a written agreement and sign it. This agreement should include the amount borrowed and the repayable amount with date.
You do not want to harm the relationships that you have created because of money related issues.