Financial emergencies can strike when you least expect them and leave you worried about how you’re going to cover the costs. Fortunately, there are plenty of ways to plan for unexpected expenses, build your emergency savings, and be prepared for whatever life throws at you. On that note, here are four common financial emergencies and how to overcome them.
You could lose your job for various reasons including redundancy, sickness, or poor performance. Becoming unemployed can have a huge impact on your finances and lifestyle, particularly if you’re the main breadwinner in your household. For that reason, you should have a plan in place to protect your finances and family if you ever face unemployment. Building an emergency fund is one of the simplest ways to ensure that you have savings set aside to cover your expenses if you ever lose your main source of income. If you are self-employed, then it may be worth taking out income protection insurance so that you will continue to receive a monthly income if you are unable to work due to illness or disability, for example.
2. Car problems
Car problems tend to strike when you least expect them and can leave you stranded with huge mechanical bills. Car repair bills can quickly run into the thousands and repairs may take several days to complete. Car breakdown insurance can help cover some of the costs associated with car problems i.e. you won’t have to pay to have your car towed to a garage. However, you are likely to still need to pay for the repair costs. Again, it is a good idea to put some money aside each month to cover unexpected car repairs.
3. Boiler breakdown
Having a fault with your boiler is never ideal, especially during the cold winter months. According to homeadvisor.com, the average cost of a new boiler is $4,000 but can be up to $7,500 for a high-efficiency model. If you find yourself stranded without the cash to pay for urgent repairs to your heating system, then you should consider taking out a short-term loan. For instance, experts at http://fastmoneycartitleloans.com/ explain how you can apply for a car title loan and borrow up to 50 percent of the value of your car. Having quick access to temporary loans means that you never have to worry about being unable to afford repairs if your boiler ever breaks down or you have to deal with other household emergencies like a leak or pest infestation.
4. Medical bills
Sadly, medical emergencies are a common cause of financial stress. You or a family member may require professional medical treatment due to an injury, illness, or disease. Requiring professional medical assistance can leave you with huge medical bills costing hundreds or thousands of dollars. It is natural to worry about how you would afford medical treatment if you or a family member becomes unwell. Taking out health insurance is one of the easiest ways to ensure that you are financially covered if you ever require medical treatment. Depending on your level of cover, any medical services you require will either be fully or partially covered by your insurance provider. Make sure that you shop around and choose a policy with a reputable provider that offers the highest level of cover you can afford.