Before Hurricane Irene hit the East Coast, natural disasters had already cost the US a total of $35 billion in damage! These natural disasters left a lot of people scrambling to find some cash in a hurry. These types of emergencies call for quick action but if you’ve already used up your savings you will need to look for other ways to get the money.
The 3 F’s: Family, Friends, and Feds — Money can always be a sensitive issue especially when it comes between friends and family but if it’s an emergency you know you can look to your friends and family for help. DON’T make the mistake of treating the loan from a family or friend lightly. Treat the loan as an actual business relationship by putting it in writing and agreeing to a reasonable interest amount. Without assigning an interest amount the transaction can’t be considered a loan. The government posts different rates on a monthly basis as well as a minimum interest amount between friends and family, find this information on the internet for help.
Federal help can be an option too. FEMA is able to help during a natural disaster if certain requirements are met. Borrowers must be in a FEMA-declared disaster zone in order to be considered for financial help. The US Small Business Administration is also known to aid people in financial crisis but is for subsidized loans for home and business owners. To apply for either of these one must first go through their insurance agent.
Borrowing from Insurance and Bank Accounts — Borrowing from your life insurance, CDs, mutual funds, retirement or 529 accounts is another option. Depending on penalties and how much you’re able to borrow these can be very helpful options. Before borrowing make sure you know exactly what the penalties or interest might be and choose your best option.
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Mike Spicer / 714-255-5650 / firstname.lastname@example.org