As hard as we try to spend cautiously and save carefully, sometimes we’re hit by an emergency that leaves us needing to get money quickly. It could be a car breakdown, a vet bill, a boiler explosion – whatever it is, we suddenly find it’s a week until pay day and we have a cat with a leg in plaster/car exhaust on the road/no hot water. (Delete as appropriate.*)
A couple of years ago for example I came home to find a huge puddle of water on the kitchen floor. I looked around suspiciously. No taps were on and the ceiling was intact. I opened the freezer. Things were suspiciously warm and NOT icy.
Now although I did spend the winter of 1997 living without a fridge and keeping single pints of milk in the garden overnight, this was the summer. Plus I’m not 19 and living in poverty any more so you know, I did quite want a fridge that worked. Fortunately I had a little bit of money set aside, but not everyone is so lucky. If you find yourself needing money for an emergency purchase, I’ve put together a few ideas for ways to get money quickly.
Please note: these are simply suggestions, not financial advice, and my ideas are meant to be for anyone who needs to get money quickly for one-off emergency purchases, not day to day spending or treats. If you are struggling to meet everyday expenditure, like food or bills, then speak to a debt advisor. You can call the Money Advice Line on 0800 138 7777 or try a debt charity like Step Change.
The best way to deal with emergency purchases it to have a pot of money set aside for just this. If you don’t have any emergency savings set aside then start now with a regular savings plan, so that next time you need to get money quickly, you’re prepared. I have some really easy money saving tips here and here, or if you don’t feel you have anything spare to save from your existing income, you could take a look at something like The Money Shed or MLMcompanies.org for lots of ideas for ways to earn extra money from home.
Ask for an advance on your wages
If you’re in work, your employer may be able to help with a short term financial emergency by allowing you to take some or all of your wages in advance, normally interest free, which is a big plus over other types of borrowing. Be straightforward and professional in your approach, and make it clear that this is a one-time only issue. Your employer isn’t responsible for helping you manage your day to day finances but they may be able to help you get money quickly for a serious emergencies. Remember that you’ll need to budget very strictly until the next pay day, so as to not end up short again.
Borrow from friends or family
Although this can often feel like the obvious solution, it does come with risks – namely the potential impact on your relationship should anything go wrong. If you do have a friend or family member who is able to help then great, but don’t assume that just because they are someone you know means you can be relaxed or vague about the arrangement. As uncomfortable as it may be to talk about, make sure both parties are totally clear from the start about the agreement. Ideally it’s best to put it in writing, with a structured repayment plan. Have the discussion too about what will happen if you can’t make the repayments.
Recycle your old mobile phones
If you’re able to wait a week or so for your cash, then you can often cash in old mobile phones for a lot more than you expect. Most of us have at least one old handset lying around in a kitchen drawer somewhere, so dig them out and check a service like Compare and Recycle to find the best offers from different mobile phone recycling companies.
Borrow from a credit union
Credit unions are member-owned organisations, designed to provide simple financial services to local communities, often at a lower cost than high street banks. You’ll need to be a member and some credit unions will require you to have spent some time building up savings before you are eligible to apply for a loan, so it might be worth doing that now, ready for the next financial emergency.
Search for your local credit union here and find out more about savings and loan options.
Sell your stuff (including gift vouchers)
As well as mobile phones, there are all kinds of opportunities for cashing in unwanted items around the house when you really start looking. Unwanted clothes, books, CDs, DVDS, sports or gym equipment you bought but never used – it’s all crying out to go to a good home. Try taking a pitch at a local car boot sale, or if you don’t fancy that, go for buy and sell sites like eBay or Gumtree. You’ll be surprised at what stuff people want!
Also check your purse for any unwanted gift vouchers that you may have lying around from birthdays or Christmas, as these can be sold too. I use Zeek to buy and sell mine – definitely worth a look.
Talk to your bank about an overdraft
Going overdrawn isn’t ideal, but it can be an affordable way to get money quickly in the short term if you talk to your bank and are able to set up an authorised overdraft. Unauthorised overdrafts can be costly however, and if you end up having payments returned because you’re over your limit, fees can add up very quickly.
You might find that you have the option to be overdrawn for free up to a certain limit – I have one of those bank accounts for example where you pay a small monthly fee and get benefits like travel and phone insurance included. One of the additional perks is a £300 free overdraft, which I can use at any time, so do talk to your bank about your options.
Get a short term loan
If you’ve exhausted other options, you might consider a short term loan from a specialist provider like Ferratum. The benefit of this kind of borrowing is that you can get a decision very quickly, and normally have the cash in your account on the same day. However, interest rates are very high, and you will end up paying back significantly more than you borrow, so make sure you have the ability to make repayments. Ferratum loans has a very clear calculator to show you exactly how much you will be repaying based on loan amount and repayment period. Do your research to find a trusted option before you make an application and check things like reviews and ratings from independent sites. Ferratum currently has a 9.3/10 ranking on Trust Pilot, which is classed as excellent.
Remember, this kind of borrowing is for one-off, emergency purchases, not for day to day spending and should never be used to pay back existing debts. Only take out a short term loan if you are certain that you can repay it on time.
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*I say ‘delete as appropriate’ because I had a message today that began ‘Hi Slummy Single Mummy, we love reading your blog and as a top Mummy/Daddy blogger (delete as appropriate) we wanted to share the details with you of our new children’s safety campaign..’ It annoyed me.