VOL. 133 | NO. 134 | Friday, July 6, 2018
Rays of Wisdom
Dana and Ray Brandon
When You Need Money Fast
Ray and Dana Brandon
Ray’s Take: It’s something we hope never happens to us, but at least once in your life, you will find yourself needing money fast. More than you ever dreamed of when you set up your six months’ worth of expenses emergency fund. So what do you do if you find yourself in this situation?
First, I would start by defining your “need” for the quick cash. Is this is a true financial emergency such as saving a home from foreclosure or trying to avoid a bankruptcy filing? Or is this “need” for something that’s more a want that is now on sale? I always recommend saving and never splurging on impulse buys that involve draining your bank account or emergency funds if it’s not truly necessary.
But if in fact you do find yourself needing cash fast, here is what I would recommend you do and in this order.
As much as I hate debt, sometimes it is necessary. HELOC’s and margin debt are available, but don’t sign until you have the expense reduction plan in place to pay them back.
Raise cash. You may not want to sell that stock you bought when it was cheap, but now is the time. It is slow, tedious and painful, but eBay works. It is also a good reminder of how little things you paid so dearly for earlier are really worth. It also clears out reminders of prior waste. I’d love to say you can learn financial lessons from books or CNBC, but the hard cold reality is that if it doesn’t hurt you, you rarely learn the lesson.
Ask family for help. Yes it’s humbling, but it is family and their terms are likely more reasonable than banks and consumer finance. Bad luck sometimes comes in groups and flexibility helps.
And here’s what I recommend you do NOT do … anything with an 800 number in front of it (1-800-cash fast). Do not do consumer debt or title loans of any kind. Don’t borrow from friends even if they offer.
Dana’s Take: Needing money fast has been a topic of interest at our house lately. Our oldest booked a 5-week tour of Europe for college students. The price was pretty reasonable. Six weeks before the tour began, however, they sent a message suggesting $100 per day for spending money. That’s $3,500 for 5 weeks. Fortunately, she was able to find three good summer jobs. The sad thing is that, despite constant shifts, the paychecks grow pretty slowly.
In the other case, our younger child purchased concert tickets beyond his budget. He is now trading some of his summer vacation to repay the charge.
Making money quickly is tough. Get around to funding that emergency fund—it works better than a lemonade stand.
Ray Brandon, CEO of Brandon Financial Planning, and his wife, Dana, a licensed clinical social worker, can be reached at brandonplanning.com.