We’re all feeling the pinch lately. Energy bills are rising, housing costs are rising, food bills are rising. You get it – costs are rising. The trouble is, most people’s wages aren’t increasing, which causes a bit of a squeeze on your budget.
On top of that, if you suddenly have an unexpected bill – like your car breaks down (that’s my most frequent unexpected bill, it happens so often it’s almost expected!), it can squeeze your finances even more.
Below are some good tips for dealing with unexpected expenses.
Borrow Some Money
Sometimes you just can’t make it work with what you’ve got. Sometimes you know full well you’ve got money coming in, but it doesn’t arrive in time to sort out that bill. In these circumstances, you might need to borrow a bit of money to tide you over. You could borrow from friends and family, or borrow funds online. Either way, it gives you a bit breathing space while you get everything in order.
Shuffle Things Around
Sometimes, if your finances just aren’t working out and you have a big bill to pay, you can shuffle things around a bit. Depending on who you owe your money to, you can sometimes pay a lower amount or miss a payment without hurting your credit score. Some mortgages have this feature build in, allowing you to miss one payment in a 12 month period (providing it’s arranged in advance). The only way to do this is to be up front, so don’t skip or lower any payments without getting permission first.
Check Your Online Accounts
I know it sounds silly, but sometimes you can leave money sitting in online accounts that you’ve forgotten to withdraw. Perhaps you have some funds in your PayPal account that you’ve forgotten about. If you use any cashback apps, you might be able to cash out there too. Try and remember any other accounts you might have money tied up in and investigate whether you can get your money moved to your bank.
Budget for Change
Ideally, it’s good to have a bit of money set aside for emergencies. It can be hard to figure out where that money will come from to be put away for the future. The truth is, most people don’t budget.
People tend to think they’re budgeting by keeping a running total in their heads. They have an idea of how much they’d like to spend on their weekly shop or how much they spend socialising, but without close monitoring, these budget tend to stay quite loose.
Instead, sit down and look at your finances. What can you count on going in? What comes back out every month. What’s left over? Once you know what you’re dealing with, you can make a very rigid budget and stick to it exactly. This ensures you don’t go over by a little bit here and there. These little bits over a month can add up to a fair amount, and that amount might be worth putting in a separate account for a rainy day.