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08.18.2020 / Budgeting « Back to all articles

Getting the Most Out of Your Crisis Budget
Getting the Most Out of Your Crisis Budget

Creating a crisis budget helps you weather the storm when something unexpected happens. Whether you're in the middle of an emergency now or are planning for the future, a crisis budget is your action plan for getting through to the other side. 

Calculate Your Bare Minimum Expenses 

The first step in creating a workable crisis budget is figuring out how much money you need to get by. List only what you need to provide food, clothing, shelter, utilities, and transportation to work if necessary. You may want to compile a list of debt payments and other obligations that you should pay if at all possible. If you decide to list these things, put them in a separate category. Leave out anything extra, such as dining out, new clothes, and so on. 

Add Up Your Assets and Income 

Now that you have your bare minimum number (and possibly your bare minimum plus other obligations number, as well), it's time to see how much money you have to cover those expenses. Include your salary if you still have one, any emergency savings you have in the bank, and the value of items you could quickly liquidate, such as a second vehicle that you could do without. If you have enough money to cover your expenses for now, great. If you have enough money for this month but nothing in the pipeline for next month, look for more ways to cut back. 

Reassess Your Priorities 

Chances are, if you are in emergency mode, you have already cut out things like streaming video services and gourmet coffee drinks. You may feel like you have cut back your spending in every way possible. However, if you still don't have enough money to cover your necessary expenses, it's time to transition to survival mode. Rethink any cost that is not essential until you get through this difficult time. 

Ask for Assistance 

Many creditors, landlords, and utility companies offer emergency assistance in the form of credits, waived fees, or extended payment plans. Even if the companies you contract with don't announce that they have these options, contact them anyway. They may be willing to help you even if they do not advertise their assistance programs. Before you accept assistance, be sure you understand the details and calculate the cost of drawing out your payments over a longer timeframe. 

Figure Out How Long You Can Survive on Your New Budget 

Now that you have adjusted your budget to make your money stretch as far as possible, create a game plan for increasing your income over the next several days, weeks, and months. Knowing exactly how long you can survive on what you currently have is crucial to planning your next steps. 

09.28.2020 / Borrowing

Should You Refinance Your Home?
Mortgage rates have reached record lows. With the economy now coasting into a recession, it is only natural that you…

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Loan?

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08.18.2020 / Budgeting « Back to all articles

Getting the Most Out of Your Crisis Budget
Getting the Most Out of Your Crisis Budget

Creating a crisis budget helps you weather the storm when something unexpected happens. Whether you're in the middle of an emergency now or are planning for the future, a crisis budget is your action plan for getting through to the other side. 

Calculate Your Bare Minimum Expenses 

The first step in creating a workable crisis budget is figuring out how much money you need to get by. List only what you need to provide food, clothing, shelter, utilities, and transportation to work if necessary. You may want to compile a list of debt payments and other obligations that you should pay if at all possible. If you decide to list these things, put them in a separate category. Leave out anything extra, such as dining out, new clothes, and so on. 

Add Up Your Assets and Income 

Now that you have your bare minimum number (and possibly your bare minimum plus other obligations number, as well), it's time to see how much money you have to cover those expenses. Include your salary if you still have one, any emergency savings you have in the bank, and the value of items you could quickly liquidate, such as a second vehicle that you could do without. If you have enough money to cover your expenses for now, great. If you have enough money for this month but nothing in the pipeline for next month, look for more ways to cut back. 

Reassess Your Priorities 

Chances are, if you are in emergency mode, you have already cut out things like streaming video services and gourmet coffee drinks. You may feel like you have cut back your spending in every way possible. However, if you still don't have enough money to cover your necessary expenses, it's time to transition to survival mode. Rethink any cost that is not essential until you get through this difficult time. 

Ask for Assistance 

Many creditors, landlords, and utility companies offer emergency assistance in the form of credits, waived fees, or extended payment plans. Even if the companies you contract with don't announce that they have these options, contact them anyway. They may be willing to help you even if they do not advertise their assistance programs. Before you accept assistance, be sure you understand the details and calculate the cost of drawing out your payments over a longer timeframe. 

Figure Out How Long You Can Survive on Your New Budget 

Now that you have adjusted your budget to make your money stretch as far as possible, create a game plan for increasing your income over the next several days, weeks, and months. Knowing exactly how long you can survive on what you currently have is crucial to planning your next steps. 

Need a
Loan?

Loans from $120 to $15,000. Get funded as soon as today!

09.28.2020 / Borrowing

Should You Refinance Your Home?
Mortgage rates have reached record lows. With the economy now coasting into a recession, it is only natural that you…