No matter how careful and responsible you are with your finances, unfortunately, there is sometimes no escape from unexpected expenses. At some point in their lives, most people will face that dreaded moment when their car just gives out in the middle of running errands, or when they are about to take a shower before work and find that there’s no hot water. In these instances, the prospect of having to club together money to cover these unexpected expenses can be emotionally and financially stressful, which is why it is important to think of a few different plans of action in case you are faced with a similar situation.
Create an emergency fund
Having an emergency fund is the best preventative measure you can take in case of unexpected expenses cropping up. This is a dedicated amount of money which you put away only to be used for emergencies, such as if you don’t have enough money to pay your rent, or if you need to get your car fixed when it breaks down. You could either save this money in a dedicated savings account or keep it as a liquid asset within the home. The more money that you can save in this capacity, the better because this will help you to avoid amounting huge debts that you don’t have the financial means to deal with.
Borrow the money