When Savings Aren’t Enough

by Redeeming Riches on June 23, 2012

Every budget includes a savings line where people try to put a little away for a rainy day. The problem with this scenario is that when it rains it pours and sometimes savings aren’t enough to cover an emergency, but you can still turn to payday lenders like this when times are tough. Even if you have bad credit or no credit history, payday lenders will give out short-term loans based solely on your employment history. In this way, the payday lending industry meets a very crucial function for low-income or cash-strapped borrowers who may find it hard to scare up funds any other way – even when they’ve planned for the worse.

Medical Emergencies

Lots of people are putting aside their medical care as they are either uninsured or unable to afford treatment. However, if you wait too long, you may create an even bigger problem should a patient’s condition deteriorate. Saving money for immediate urgent care can reduce the worry of being treated, but there is still after care and medications that must be paid for when the emergency is over. Even those that have insurance may find that the deductibles are too high to sustain without some sort of borrowing. If you can’t find a way to make a deal with the healthcare provider, you can use payday loans to help fund the medical expenses.

Car Repairs

Another typical emergency that people use their savings for are car repairs. The problem with car repairs is that no one can reasonably foresee the amount of money they will cost. You may think that budgeting $1000 a year is enough until the bill comes in at $2000 or more. Today’s cars are expensive to fix due to their computerized parts and foreign manufacturing processes. Even if you can afford to get a car fixed, you also have to allot money for rentals during the time it is in the shop. There’s no doubt that a car is a necessity in this modern age and when your savings plan falls short, one can still find some extra emergency cash in the form of a payday loan. It can also provide you with extra cash if you decide the best decision is to trash the car and put a down payment on a new one, rather than repairing one that has reached the end of its service life.

When You Are Most Vulnerable

Imagine, for an instance, that you did save a few thousand in your emergency savings and then you got a double whammy – a car and a medical expense. The fact is that life is not fair and some people experience multiple issues at the same time. Sometimes, the cause of the multiple expenses stem from the same incident – like a car accident that lands you in the hospital. While you might be able to cover one item, two maybe stretching your resources thin. One way to reduce the potential impact on a budget is to pay higher premiums so that you can reduce your deductible and always carry health insurance as well as car insurance. However, even with the best of planning, once you use your emergency fund, that’s when you are most vulnerable to being short of cash as it can take several months to build it back up. In between, any extra mishap can be enough to send your budget into a tail spin. By having done your homework first and locating extra sources of lending ahead of time, like online payday lenders, you know that you can bridge the gap between the time to build the emergency fund back up again and the time the next mishap occurs.

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