No Money, No Options What Do You Do?

Month by month financial conditions have gotten worse throughout the course of this year with daily layoffs around the country and unstable stock markets throughout the world. Realizing that current conditions have many families strapped for cash and options, I decided to focus this month’s column on three options to help you deal with shortages of cash in your household.

Borrow Now Pay Later at Low Cost

Many credit unions are offering low cost loans to existing members who need a little extra cash. Members can borrow sums of money and pay back at a very low interest rate and a low onetime fee. A similar concept to payday loans, this is a better alternative as credit unions are not in business to realize huge profits through the collection of astronomical interest rates like pay day loan companies. Additionally, because credit unions are owned by its members, you can rest assured that you are not being taken advantage of. Contact your credit union to see if they are participating in such a program.

Relatives

The current economic environment is not news to anyone as most folks are suffering in one way or another. If you are trustworthy and have a relative who has extra financial resources that he is willing to lend to help you out this is an excellent option. No one should feel ashamed to ask for help. In fact, I think you should be ashamed for not asking. Because money has ruined a lot of relationships throughout the years, you should be conscious of this and make every good faith effort to repay the loan just as you would one that you received from an established financial institution. Similarly, if you are having a difficult time adhering to agreed upon terms, you should be proactive in letting your relative know and try to make different arrangements as needed.

What Else?

If you aren’t a member of a credit union that offers a short term loan type program and don’t have a relative who could loan you some money, what else can you do? You should call up your creditors and make them aware of your situation and attempt to negotiate terms that you can adhere to while you catch things up. Additionally, as a fan of budget payment plans, explore all options with utility companies to keep your home running smoothly. Even after you have made arrangements, if you think you are going to be late or if something has come up it is important to update your creditors on your status. In these economic times, the last thing you want to do is give someone a reason to doubt your word when it comes to money.

If you aren’t able to do any of these things, you should prioritize your expenses in a written document and commit to using the money you have to pay for all essential items and services first. That is, you should pay for mortgage or rent, car – if it is your only mode of transportation to work -, electric and gas bills, and food first. Things like internet service and even cable or satellite television should be the first things you forgo if you don’t have enough money to meet all of your financial obligations.

Finally, I know it is easier said than done, but try not to stress about it. As long as you know you have made a good faith effort to meet your obligations, you shouldn’t beat yourself up. Additionally, remember that stressing alone never solved a problem.

More Family Finance:

http://extension.usu.edu/utah/htm/family-finance

http://extension.oregonstate.edu/fch/healthy-families/family-finances

http://www.usa.gov/Citizen/Topics/Money/Personal-Finance.shtml

Michelle Sharrow

Michelle Sharrow

Michelle P. Sharrow, MBA author and editor of Family Finance, is based in Waldorf, Maryland, she holds a Masters Degree with a concentration in Finance. Michelle provides a monthly column on ways to help families maintain their finances and stick to a budget titled, Budgeting and Savings for Families.
Michelle Sharrow
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