Every financial planning expert will tell you to have a budget and stick to it. And while this may be helpful for the most part, life happens, and we need money for things not included in the budget. Ideally, it helps to set aside a percentage of your budget for unplanned purchases
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Still, if your budget is tight and every cent is accounted for, or if you have left a small percentage unassigned, you may find yourself in a situation where you need extra money. It may be for an emergency, like if your geyser bursts and needs replacing, or your child has been selected to go on a pricey school sports tour, and you don’t have the heart to tell them that your budget doesn’t allow it.
Luckily, there are ways to pay for these unplanned expenses, even if you’ve little to no savings. You can either borrow or find a way to make extra money to cover your costs.
Make Extra Cash
It’s always better to make the extra money you need to pay for your expenses in cash. It would save you from needing to add another cost to your budget if you were to borrow money. There are so many ways to make a bit of extra cash; you just need to be creative. If you’re looking to make money once-off, to pay for a specific thing, think of things that you can do that don’t require any additional investment. Here are some ideas:
Sell Your Stuff
The second-hand market is growing. There is a move towards sustainability, where people concerned about the environment would rather buy used products than something brand new. It’s to prevent more items from being dumped in landfills and to slow the manufacturing of new things, as factories contribute massively to pollution. Also, buying second-hand is considerably cheaper.
You can sell almost anything, provided it’s in good condition. Look around your house for furniture you no longer use, toys, clothes, sporting equipment, and electronics.
Tutoring
If you’re an expert on something or are knowledgeable in a school or university subject, you can offer your services as a tutor. It will cost you nothing as you will not need to purchase any resources, and if you need additional information or coursework, you can search online.
You can advertise your services at local schools, on social media, or through word of mouth.
Another option, if you’re multilingual, is to teach a second language. You don’t have to have in-depth knowledge since many people simply seek others to practice their speaking skills. In this case, you can offer conversational classes. Many online platforms allow you to provide this service. Depending on the platform, you will need to register, upload a video or outline of a lesson plan and set your rates.
Borrow Money
You might consider borrowing money if you’ve got nothing to sell and have no room to take on extra work. Personal loans are good options since you can use them to pay for anything. There are many different personal loans available from various lenders, so it’s up to you to do your homework and find one best suited to your needs.
Before looking for loan options, you must determine your credit score. Knowing your credit rating will point you towards where you should apply. With a high rating, you can get a loan from anywhere, but it would be best for you to apply at a bank. Personal loans from banks are usually more affordable since the interest rates are lower, and you are typically given more time to repay them, easing the financial burden.
If your credit rating is poor, there are loans specifically designed for folks with bad credit. You can apply in-store at the lender’s premises or online with lenders like CreditNinja.com or other online lenders. Another option is to apply on a lenders’ network site that allows you to submit one application that’s sent to multiple lenders. It’s convenient as each lender will look at your application and send you quotes that you can compare.
There are lots of loans that you can apply for with poor credit, but two options include:
Co-signed Loan
If you prefer not to apply for a bad credit loan, a good option is to look into a co-signed loan. It requires you to get someone to sign for the loan with you. It provides surety to the lender that if you default on the loan repayments, your co-signer will be responsible for your debt. Although the co-signer will be liable if you don’t pay back the loan, they don’t have access to the funds.
An advantage of securing a co-signed loan is that if your co-signer has good credit, you will likely get a loan with a lower interest rate.
Payday Loan
Payday loans are convenient when you need money fast, but you must be aware that they come with high-interest rates and a very short window to repay. The amount you can borrow is based on your income since you must repay it on your next paycheck or within fifteen to thirty days. If you can’t repay the loan, you can roll it over, but more interest is added, increasing the amount you owe.
Applying for a payday loan is simple. All you need is to be over eighteen, prove that you have an income, and provide personal details like your identity document, bank details, phone number, and address. Once approved, you can expect the funds to be paid into your account within a day if you’ve applied online, or you can receive it in cash almost immediately if you’ve applied in person.
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