Nothing is as unpredictable as life - one moment, you could be at home chilling with your favourite show, and the next, you receive a worrying call.
While you cannot change or control the future, you can definitely prepare for it. One excellent way to prepare is to have your finances in order because money can solve a lot of problems. And the best part is, you don’t have to earn big to be financially ready; here are three practical ideas;
Insurance
The holy grail of all funds is insurance to help you secure your future. You can take out multiple insurance covers at once, including home insurance, motor insurance, liability insurance, and many more from One Insurance here in the UK.
When you protect your belongings like your car and home with insurance covers, you can be prepared even when disaster strikes. Insurances are excellent for offering you peace of mind knowing you’ve protected yourself and possessions should something unexpected happen at any time.
Today, you can take out cover for almost anything, including your pet, and jewellery. This goes to show just how much insurance is essential and worthwhile. So go on, take that insurance and rest easy knowing you’re covered should something happen.
Emergency Fund
Unlike insurance, an emergency fund is a type of savings, and only you get to control it. The beauty of an emergency fund is you can use it for any emergencies that come along because that’s its sole purpose.
Also, you can have an emergency fund as big or as small as you want, so when a minor emergency arises, you’re well prepared for it. As part of your savings, you can set some aside for a specific goal. For example, if you plan on starting your business, you can set aside money from your current job to have enough to sustain you when you take the plunge and quit.
Other emergencies to anticipate if you’re a parent is your kid’s health. For example, your kid may become ill or experience a nasty fall and be on crutches or a wheelchair for a couple of months, and you have to have time off work. Your emergency fund will help you if this happens.
Good Credit
Unfortunately, you cannot write off your debts and start from scratch; you must pay off all your loans on time to maintain good credit. One of the many benefits of good credit is you can apply for an emergency loan and quickly get it. On the other hand, lousy credit reflects your inability to take responsibility for your debts; hence banks will deem you a risk.
Learn to deal with your financial emergencies like a pro by only applying for debts you can pay off in time. Maintain good credit by avoiding impulse loans when you have other viable options to get quick money.
Avoid unnecessary spending, save a portion of your income, and above all, make investments to eschew bad debts.
Following the above three tips will help you be assured knowing you have backup finances for when life takes a turn.
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