Dealing with an emergency can put stress on your physical, emotional, and financial well-being. While insurance and savings can help, they are not always sufficient. And even if you’ve planned for the unexpected, an emergency can feel overwhelming and could also be too much for your current finances to handle all at once.
Let’s explore the potential financial impact of emergencies, some protections you can put into place in advance, and how applying for a personal loan can help during a crisis. If this option makes sense, we can show you how to get a loan to help cover your emergency expenses. With a Discover personal loan, money can be sent as soon as the next business day once you’re approved and accept the loan.
Financial emergency situations
An emergency requiring financial assistance typically involves some unexpected expenses that require immediate attention. You might, for example, return from vacation to find a leaking hot water heater or a burst pipe. This isn’t a life-threatening emergency, but it does mean taking quick action to stop the leak, arrange a replacement, and clean up the mess. The fix may require more than just paying for a new water heater. It may involve replacing carpeting and drywall or repairing flooring that has had flood damage. Costs can add up quickly, even if covered by insurance. The same is often true for other emergencies.
How to deal with a financial emergency
When emergencies happen, more than just money gets spent. Your time and attention are most likely focused on resolving the issue. Once you’ve cleared up the emergency, you can often find that it has left lingering financial obligations you hadn’t budgeted for. If you’ve planned and been able to build an emergency savings account, this may be the time to withdraw from it. If you don’t have savings, you may want to think about an emergency loan to help you get the money you need quickly.
The best way to handle a financial emergency is to try and be prepared in advance.
- Set up an emergency fund. Experts recommend that you have the equivalent of three to nine months of expenses saved as an emergency fund. The thinking is that an emergency can include the loss of income. If that happens, paying for everyday living expenses can become difficult. However, if you have an emergency fund, you have given yourself some time to get back on your feet financially. If you don’t have an emergency fund, you’ll need to seek other options now and use this experience as a prompt to start saving as soon as you’ve recovered.
But if your emergency fund isn’t a total solution, don’t worry. You still have options.
- Rely on a support network. Consider calling on family and friends for emotional support and advice. Most people have faced financial emergencies at one point or another in their lives. They might have learned something that could be helpful for navigating your current challenges. If you feel uncomfortable talking about finances with loved ones, remember that money issues are only one part of what you’re facing. An emergency demands your full attention; you might need a hand with some other basics of life while you deal with it. Friends and family offer time, attention, and emotional support, all of which are as valuable as funds in your bank account. You might have someone close who would be happy to bring a meal over. Maybe you need help watching your kids or taking care of your pets. Just having an attentive ear can sometimes work wonders.
- Look into other support systems. Depending on the situation, you may be eligible for government assistance, as many have been during the COVID-19 pandemic. Additionally, you can reach out to your creditors to explain your situation and ask for help. Or maybe you can find some extra cash by rethinking your budget. Read tips on steps you can take while in the thick of your emergency.
- Check your insurance coverage. Damage to your home, car, or other property may be covered by your insurance policies. Be sure to look them over and talk to your agent or insurance company.
- Get an emergency personal loan. When you need additional funds, a loan can be a viable option. A personal loan may give you fast access to needed money and give you a manageable repayment plan. A Discover personal loan, for example, can be used for emergencies or any expenses that come up unexpectedly. It’s a straightforward loan with a simple application process and a same-day decision in most cases. And funds can be sent as soon as the next business day after acceptance, which comes in handy when dealing with emergencies.
Plan for the worst by knowing your options. Put your emergency plan in place. Begin saving now. And if you don’t have insurance, get it. And rest comfortably knowing that you can apply for a personal loan from Discover for added security in a time of need. A fixed interest rate and a set regular monthly payment for the life of your personal loan will help simplify your repayment.
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