There may be a time when you run short of cash as a result of some
emergencies, and right in your front are bills to pay or other needs to
meet. In this situation, what do you do?Experts say this is where emergency fund and sinking funds are significant. Such fund will help you get over moments of dry pockets.
Miriam Caldwell, personal finance specialists said the key to surviving those months is to have a plan in place so that you don’t end up falling behind on payments over the next few months.
“Your emergency fund and sinking funds can do a lot to help you get through the months when you have several unexpected bills. They allow you to spread out the cost of the emergencies by putting aside a little each month. It makes it easier to take on those unexpected bills and other issues that may come up,” she said.
According to her, there are months when you may use up the entire emergency fund, and you will need to find additional solutions when you are short on cash. However, taking the time to establish one now will prevent you from being in this situation again in the future. You need to adjust your spending so that you can put money aside each month to cover these expenses.
She said you can also work to raise some cash quickly to pay for your emergency and the easiest way to do this is to sell some items that you already own. If you cannot do this find a temporary job that you can take that will pay you in tips. This will allow you to earn money and get paid the same day. You may also take on additional part-time work that will pay daily or weekly to allow you to be paid more quickly.
Caldwell explained that being short on cash means that you either are not planning well, or you are not sticking to your budget each month. This is especially true if you are consistently running into this problem. You can address this problem by working on tightening up your budget. You should cut your spending.
Consider switching to cash to cover all of your other expenses during the month so that you can more closely monitor your spending. If you have not been budgeting, you may realise that you simply do not make enough to cover the bills. If this is the case, you have a true income crisis and you need to find a long-term solution to help you manage your bills.
This means you should create some career goals and think about returning to school to increase your earning power. It is important to address these concerns or you may end up running up a large amount of debt that can be difficult to pay off. Your budget is the most important tool you can use to get control of your money.
By: HOPE MOSES-ASHIKE
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