Best Ways To Deal With Life’s Unexpected Costs

Although keeping a roof over our heads, food on the table and a generally comfortable home isn’t easy, most of us manage to get by. However, every now and then life throws us a fast one, and we end up with a big, unexpected cost on our hands. Your computer might decide to blow up, your kids might break some expensive sports equipment, or you might just make a big purchase without thinking it through. Whatever the reason, here’s some ways you can handle unexpected expenses.

First and foremost, find out how much of the cost you’re actually responsible for. For a lot of people, when something big and expensive breaks, it’s natural to assume responsibility and pay for it out of their own pocket. While you may be technically responsible for the damage, this isn’t always the end of it. One common example is if you’re a tenant renting a house. If something breaks when you’re around, don’t suddenly jump to the conclusion that it’s going to cost you. Landlords often agree to cover many expenses in the initial tenancy paperwork, and it’s important to know what you need to pick up and what you don’t. Before you pay a small fortune to have something fixed, go back through your papers, and find out what your rights are. Paying out for something and later realizing that you could have gotten it for free isn’t a great feeling!

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Next, tap into your emergency or “rainy day” fund. As I mentioned before, unexpected costs can come from everywhere. Gas costs, food costs, insurance premiums and taxes can all shoot up at a moment’s notice. Aside from that, a short-term illness, the sudden loss of a job, your boomerang kids wanting to move back in and all kinds of other things which can spring up out of the blue. It may screw up your plans for the future, but in times like these you may have to dip into your savings. Short-term financial solutions like the ones from Personal Money Store can make the issues go away. However, it’s always better to lean on your own capital, and avoid any interest. If your savings are looking a little sparse, then it’s time to turn that around! Draft a savings plan based on your income, and stick to it. When you need it, that cash cushion will be there to catch you.

Another effective way to mitigate the burden of unexpected costs is to shed your investment losses. Like countless other Americans, you might have a portfolio with a few investments which aren’t doing all that well. If this is the case, then these hard financial times could be the perfect chance to get rid of them. Unloading all your underperforming assets has the potential to backfire, true. However, there are also a number of advantages to consider. They’ll no longer be a black mark on your portfolio, for starters. You’ll also be able to enjoy a substantial tax break. While it’s important to make sure your stocks aren’t going to suddenly shoot up in a few weeks beforehand, selling your losers can be a great way to secure quick cash and deal with your surprise expenses. You can read more on this at Bankrate.

Finally, consider postponing a purchase you had planned. You may not have had an emergency fund, or budgeted for the costs you’re now having to deal with. However, what you might have planned for is a lovely piece of jewelry, a trip to visit a distant friend, or a new TV. If you’ve already been saving for a big, planned purchase, then it may be time for a painful reassessment of the kinds of luxuries that you really need. Unless you were intending to pay for something that’s a genuine once-in-a-lifetime opportunity, then foregoing some big purchase can be a very effective way to get through these unexpected costs. I know plenty of people who have “piggybacked” their emergency funds with their other savings to pay for life’s unexpected difficulties. If you have something nice in your sights but another, unexpected cost has to take priority, then spread your available capital out. You might have to wait a little longer for that flashy new car you’ve been dreaming of. However, this is one of the tough realities of being an adult! Keep your priorities straight, and you’ll thank yourself later!

I hope that at least one of these suggestions has seen you through your unexpected expenses. If it was tough to manage, make sure you’re prepared next time!

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