A savings account is one of the most important things you can have right now. But if you’re like many Americans, you might be scraping the bottom of your piggy bank sooner than you think.
According to Northwest Mutual’s 2022 Planning & Progress study, Americans have an average of $9,000 less in their savings than this time last year. As you might think, the lingering effects of the pandemic and steep inflation rates are causing people to withdraw from these accounts without filling them back up.
This doesn’t bode well for those people who started with very little savings to begin with, or none at all. An emergency fund is supposed to help you when you run into financial trouble, but what good is it if it’s empty? If you’re fielding an unexpected emergency right now, here are some things you can do to scrounge up the money.
Take Out An Emergency Loan
If your emergency is a single financial hiccup that you don’t expect to happen again, an emergency loan might be an option. Emergency loans are last-minute stopgaps when your savings and paycheck fall short of what you need, giving your budget the boost, it needs to take care of unexpected essentials.
The right emergency loan may give you the means to take your car into the shop for urgent repairs or cover an unexpected prescription.
But how can you tell whether an emergency loan is right for your unique situation? You can start by visiting a site like MoneyKey, which gives a quick rundown on the different types of emergency loans available, like installment loans and lines of credit.
From there, visit at least five financial institutions to compare the going rates and terms. Shopping around will help you find the best option available to you today.
Speak With Your Creditors
While emergency loans may help with one-off expenses, they aren’t ideal for long-term challenges, such as unemployment or chronic illness. Nor are they the best option for everyday expenses and regular bills.
If you’re having trouble paying your phone bill because you aren’t earning enough, a different tactic might work better. Reach out to your creditors before you miss a due date and ask them how they can help you.
Many companies have policies in place for these situations, so they might be willing to work with you to find a compromise, like a flexible repayment plan, reduction in interest rates, or extensions.
Ask Family Or Friends
We all get by with a little help from our friends — some more literally than others. If your friends or family have the means to help you, they might be able to give you a fast cash advance on their own dime.
While this might seem like the best option on the list, you should approach it with caution. Money has ruined relationships before, and you could be headed down the same route if you aren’t careful.
Although it’s a cash advance from a friend or family, you should treat it like any other loan from a financial institution. Sit down with your budget so that you can clarify when and how you’ll pay them back.
If there’s a chance you can’t pay back your friend or family member, reconsider a personal IOU as a solution. It might not be worth the personal risk.
The lingering effects of the pandemic and runaway inflation have made it harder than ever to stock your emergency fund. If you’re low on savings, remember these options when you need some financial help.