We’ve all experienced unexpected financial emergencies. Big or small, these unplanned expenses usually feel like they hit at the worst times. It may be an unexpected medical bill, a car accident, a broken appliance, or a job loss. Whatever the reason, you need to find cash and fast. What can you do?
In an ideal world, we all have a good emergency fund to cover these types of expenses. However, that is not always possible.
The best source of fast cash in an emergency will vary depending on whether you need to raise funds in a few weeks or a few days. Some options are safe; others can make a bad situation worse.
1. Sell your junk
Everyone owns stuff they never use. Why not convert into cash? Sell old books and games on Amazon. Post an ad on Craigslist and sell your used tech, or host a good old-fashioned yard sale. You may surprise yourself with how much money you raise. As a bonus, you’ll clear the clutter out of your house or apartment.
2. Take on a side job
If you have a month or two to raise the money you need, consider taking on odd jobs to raise cash. Sign up to become a dog walker, or set up a TaskRabbit account and find out what your neighbors need help with. You can also consider working as a Lyft driver. New drivers may receive a $500 earnings guarantee for completing 150 rides in the first 45 days.
Can’t decide which side gig you should take on? SuperMoney can help you out with side-by-side reviews of some of the best odd jobs out there.
3. Get a loan from a friend or relative
If you’re in a bind, you can always ask a friend or relative to lend you the money. This may be the most affordable option, but you could be putting your relationship at risk. Many friendships have been lost over “misunderstandings” around loans. Make sure you put the loan agreement in writing and set up a clear plan for repayment. Then stick to your plan and repay the amount as promised.
4. Cash in your investments
Cashing in investments is not an ideal means of obtaining cash. But if you’re facing an emergency, they may be your best option. Just be careful. If you cash in bonds or stocks, you may have to pay taxes or even tax penalties if those funds were in a retirement account. You are also unlikely to walk out of your bank or investment broker’s office with cash, so they’re not the best choice if you need money immediately.
5. Tap into equity on your life insurance policy
If you have held a whole-life insurance policy for several years, you may have built up equity that you can borrow against. And since it’s a loan, you won’t have to pay taxes on it. But withdrawing money from a life insurance policy reduces the amount of cash available for payout. As an alternative, you can cash out your policy altogether. However, this might incur tax obligations on any proceeds over and above what you’ve paid in premiums.
6. Take out a home equity loan
If you need to raise a more considerable sum of money, you may be able to borrow against the equity of your home. Home equity loans are advantageous for several reasons. Because the loan is secured by equity, interest rates are usually low. Loan terms are 0ften long as well. Just be sure to repay your loan before the term is out — if you fail to do so, your home could be at risk.
7. Apply for a personal loan
If you have good credit, consider a personal loan. Many online personal loan lenders can approve your request within 24 hours and transfer the necessary funds to your account in another day. Some lenders, such as OppLoans, NetCredit, and Speedy Cash, will also consider borrowers with bad credit. However, these lenders charge very high interest rates, so make sure you can afford the payments, or you will just compound your financial difficulties.
SuperMoney’s personal loan engine can help you quickly find your best rate. Apply to pre-qualify with our network of reputable lenders all at once, just by answering a few quick questions. Plus, it won’t hurt your credit score. Apply now!
Interested in a personal loan? Compare lenders here, or see what you qualify for with our pre-approval engine here. Pre-approval won’t affect your credit score!
8. Use a credit card advance
If you have a credit card and your desired sum is within your credit limit, a credit card advance could be a “least bad” option. Be cautious: credit card companies charge steep interest rates on cash advances. If you miss a payment, you may incur penalty interest rates, or the credit card company may close your account. But if you are sure that you can repay the loan before the closing date, this is a great way to get fast cash.
Audrey Henderson is a Chicagoland-based writer and researcher. She holds advanced degrees in sociology and law from Northwestern University. Her writing specialties are sustainable development in the built environment, policy related to arts and popular culture, socially and ecologically responsible travel, civic tech and personal finance.