You might be working hard for achieving your financial goals. However, emergencies don’t seek appointments before they throw your planned schedules out of gear. Most importantly, financial emergencies can cause serious distress, unless they are planned remarkably well. You always need to have quick cash sources, such as, a trusted licensed moneylender at hand. Here are four of the most common financial emergencies and how you should deal with them.
1. Job loss
A job loss can often happen all of a sudden. It could be due to market conditions, the overall performance of your company, any change in company policies and so on. Most of these conditions have nothing to do with you. However, it is you who would be forced to face the consequences. When you lose your job all of a sudden, the first thing to do is to find an alternate source of income. Make sure you have a contingency fund at hand. Liquid investment instruments like SIPs, mutual funds and fixed deposits also help.
2. Health emergency
This could be due to a sudden illness or an accident that requires hospitalization. The best solution is to have a comprehensive health insurance policy. Make sure you have studied the terms and conditions before buying. In addition, consider investing in a contingency health fund. If you do not have the necessary amount, you may also consider applying for a personal loan from a licensed money lender.
3. Death of the bread winner
Sudden demise of the bread winner can spell disaster for a family especially if there are multiple dependants including kids and senior citizens. Depending upon the family size, the earning member should opt for enough term insurance for replacing his entire income.
4. Natural calamities
Natural calamities are unforeseen but can wreak havoc on your life. The best way to prepare for the same is to get an insurance cover for your tangible property, be it home, valuables like jewelry, vehicles and so on. Having health and life insurance is also equally important.
Emergencies are unpredictable. However, advance preparations can certainly help tide through them easily.