A couple days ago, I came across a few spam emails in my inbox that I actually had to read twice to make sure I was seeing clearly! The first one was advertising "personal loans for unplanned expenses." The second one was offering "personal loans to help you reach your financial goals." The third said, "financial help - loans to pay off debt."
WHAT?!
The idea of going into debt to get ahead financially is so preposterous, I thought it had to be a joke! Well, it is a joke, but the sad truth is that these offers were serious. Seriously misguided. Let's unpack this further, shall we?
I want to let everybody in on a little secret. "Unplanned expenses" are no longer unplanned if you...wait for it...plan for them. Of course nobody plans on the inconveniences of life happening, such as car or home repairs, trips to the ER, travel expenses due to the sudden death of a loved one etc.
We know somewhere in the back of our minds that these things happen and it is not only possible, but necessary to plan for them. It's called an emergency fund.
It's always been strange to me, how some people are so surprised and get so angry when something breaks down, like a car for example. Especially an old car. It could have been a great, reliable car for 10 years, but the moment it needs a repair that you didn't plan for, it's a stupid car and you hate it and you hate life and you are mad at the world...blah, blah, blah.
The reality is, it's doing what older cars do!
By now, some of you may be thinking, "Well that's great if you have the extra money to set aside for these emergencies!"
I have heard So. Many. People. say this and (true story) not a single one of them could legitimately use that excuse!
Remember that gym membership and/or other monthly subscription service you never use? Cancel it. And all the stuff you have sitting around the house that you no longer use? Sell it. And those daily trips to Starbucks, eating out excessively, impulse buys here and there, and paying too much for products because you refuse to shop at Wal Mart, use coupons or "waste your time" looking for deals? Stop it!
Also, do you have a car payment? If you would have saved up and bought it (pre-owned) outright, your current monthly payments could be saved in an account that earns interest to build up your emergency fund, which could have covered the car repair or other normal life inconvenience. And after you have 3-6 months of expenses saved up in your emergency fund, the money that was funding the emergency fund can now be invested, saved for retirement, vacations and/or for buying your next car outright so you can avoid making payments for the rest of your life!
Doing these things allows you to smoothly transition from car to car, repair to repair and inconvenience to inconvenience by just writing a check and then moving on with your life! Don't allow a "surprise" or "unplanned" expense to derail your finances, forcing you to fall prey to the emails like the ones I received, going into debt and spiraling even further out of control financially. Imagine the possibilities for your life when you make a plan!
We know somewhere in the back of our minds that these things happen and it is not only possible, but necessary to plan for them. It's called an emergency fund.
It's always been strange to me, how some people are so surprised and get so angry when something breaks down, like a car for example. Especially an old car. It could have been a great, reliable car for 10 years, but the moment it needs a repair that you didn't plan for, it's a stupid car and you hate it and you hate life and you are mad at the world...blah, blah, blah.
The reality is, it's doing what older cars do!
By now, some of you may be thinking, "Well that's great if you have the extra money to set aside for these emergencies!"
I have heard So. Many. People. say this and (true story) not a single one of them could legitimately use that excuse!
Remember that gym membership and/or other monthly subscription service you never use? Cancel it. And all the stuff you have sitting around the house that you no longer use? Sell it. And those daily trips to Starbucks, eating out excessively, impulse buys here and there, and paying too much for products because you refuse to shop at Wal Mart, use coupons or "waste your time" looking for deals? Stop it!
Also, do you have a car payment? If you would have saved up and bought it (pre-owned) outright, your current monthly payments could be saved in an account that earns interest to build up your emergency fund, which could have covered the car repair or other normal life inconvenience. And after you have 3-6 months of expenses saved up in your emergency fund, the money that was funding the emergency fund can now be invested, saved for retirement, vacations and/or for buying your next car outright so you can avoid making payments for the rest of your life!
Doing these things allows you to smoothly transition from car to car, repair to repair and inconvenience to inconvenience by just writing a check and then moving on with your life! Don't allow a "surprise" or "unplanned" expense to derail your finances, forcing you to fall prey to the emails like the ones I received, going into debt and spiraling even further out of control financially. Imagine the possibilities for your life when you make a plan!
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