Financial emergencies can happen at any time in any form. It might be unexpected medical bills, sudden unemployment, or property damage. Whatever the nature of the crisis, you are faced with a sudden need for quick cash.
This unfortunate situation comes to all of us some time or the other, and it comes when we are least prepared for it. What can we do? Fortunately, there is much you can do.
Ways to Raise Cash in a Hurry
If you face a serious financial crunch, you can use any of the methods given below. But remember that these are last resort, short-term measures meant to tide over your emergency like the money offered on the best instant personal loan app. Here are a few of the recourses you can take to raise some quick cash:
- Pay Day Loans
A payday loan is money lent to you by your bank until your salary gets credited into your bank account. Typically, payday loans are offered by salary account holders. It is a one-off loan, and the full amount with interest will be automatically deducted from your bank account once your salary comes in.
- Gold Loans
A gold loan is an instant cash loan to raise cash at a moment’s notice. Most Indians, even the poorest, possess varying quantities of this precious metal. So you can go to a bank with your gold and walk away with cash.
If you pay back the loan within the stipulated time, then you can reclaim your gold. Banks and non-banking financial companies (NBFCs) offer gold loans from 75% to 90% of the value of the pledged gold.
- Loans against Fixed Deposits and Mutual Funds
If you or your family members have fixed deposits in a bank or money invested in mutual funds, you can take a loan against the money held. You do not have to withdraw the principal, which remains invested. The loan that you receive is in the form of an overdraft.
- Instant Cash Loans
A good option for raising money in an emergency is through a quick cash loan. You can find the best instant personal loan app on the internet to get you money quickly. However, you would do well to do a bit of shopping around to get the lowest interest rates with favorable repayment terms.
- Salary Overdraft
If you are a salaried employee, the bank where you have your salary account may offer you an overdraft facility. You can typically get up to three times your salary from your bank through this facility.
Interest is only applicable for the duration that you use the facility. Another good feature is that you can foreclose the overdraft facility without incurring any penalty.
- Covid Loans
A product of recent times, many banks are coming forward with what they call “covid loans.” Any person who contracted covid-19 can apply for this type of loan to pay for coronavirus medical expenses.
These loans are open to salaried and non-salaried individuals as well as pensioners. There is no collateral required to be produced while applying for a covid loan.
- Family and Friends
When all avenues are closed, then you can fall back on your family and friends. If you are associated with generous people, you shouldn't have any difficulty getting quick cash.
But we have left this means of raising cash at the bottom of the list as it is least preferred. However good your relationship with a friend or family member may be, money can ruin that relationship in a concise while.
So, if you borrow money from your friends or family, ensure to pay it back with interest, even if they haven’t asked for interest. You can fix an ad hoc amount as interest. You don't want your good friends or family members to avoid you when they see you coming because they think you will ask them for money.
Plan Your Finances To Be Prepared for Financial Emergencies
A financial emergency happens to the best of us. And when it happens, likely, you won't have the required cash. Any form of instant cash loan comes at a price. The more urgent the requirement, the higher the price, typically the extra amount you pay in interest.
We can safely assume that a financial crisis will hit us sooner or later, but we may not know when. Because we KNOW that it can or will occur, why not prepare for it? Starting an emergency fund is the best way of ensuring that you are ready to tackle a financial calamity head-on when it occurs.