Cash-In? Or Bide Your Time?

Cash-In? Or Bide Your Time?

You’re running low on money and you’ve reached the point where something’s got to give. Maybe the bills are piling up, or your car just broke down, or you need to take a sick child to the doctor. Or maybe you’ve got family visiting and you don’t want to feed them Ramen noodles for breakfast, lunch, and dinner. Whatever your situation, you’ve reached the breaking point and you need cash now.

If you’ve got money tied up in investments, times like these will test your fortitude. You may be toying with the idea of selling or cashing out, even though you know it will hurt you in the long run. If you’re flirting with thoughts like these, step back and take a breather. You have other options.

Don’t Let Go

Fidelity strongly cautions against cashing out investments, especially retirement accounts, ahead of schedule. Cashing out a retirement account like a 401(k) incurs financial penalties and you lose all the progress you were making towards saving for the future. Selling stocks and shares before maturity means losing out on profits down the road. Don’t kick these financial supports out from under you and your family just to solve a temporary problem.

Ask for a Check Advance

Approach your employer for a payroll advance. A step like this hinges on your reputation at work, your employer’s policies on check advances and how long you’ve worked there. If you have a stable work history and get along well with your supervisors, you may be in luck. Best yet, you may be allowed to pay the advance back in increments rather than in one lump sum. If a direct payroll advance through an employer is a no-go, try and apply for a payroll advance online through a private lender. It essentially works the same way but will require the borrower to pay back on time to avoid paying extra in fees and interest.

Work Extra Hours

You may not feel like working overtime, but the extra income could be exactly what you need to pull you back from the brink of disaster. Ask for more hours at work or take over someone else’s shift two or three times a week. If your company has a policy against overtime, take on a small, temporary side job. Tip-earning positions like waitressing or driving the beverage cart at a golf course are great for earning cash that you can bring home each day. If you own a car, rideshare is another worthwhile option for earning extra money in a pinch.

Take Out a Small Loan

Is your credit in good shape? Then consider a small personal loan. Start with your bank, since this is likely the financial establishment that you have the strongest relationship with. If your credit is less than perfect, shop around for the best interest rates. Here’s another idea: consider taking out a loan from your 401(k) or another retirement account. According to Bankrate, this is a useful alternative to cashing it out. Be mindful, however, that your money can’t earn interest while you’re borrowing it.

Consider Pawning

Do you have a television in a spare bedroom? A set of electric tools you rarely use? Consider pawning these for cash. It’s a quick way to put money in your pocket without involving a credit check or shopping around for the perfect loan. Just don’t let it become a habit. When you’re pawning items and then paying interest to get them back out, you’re essentially re-buying your own belongings.

Ask for Help

You may cringe at the idea of turning to family or friends for financial help. Indeed, it’s a step that you need to consider carefully before taking the leap. If you have a close relative or friend you know you can trust, it may be worth it to ask them for a discreet loan. It’s a tricky step to take. You may have heard that money ruins relationships and there is certainly some truth to the saying. If you borrow money from someone you’re close to, PAY IT BACK.

Not having money can make you feel desperate but don’t make irrational decisions while under the influence of that fear. Your investments and savings accounts are there for your protection in the years to come. Protect that by finding another solution to your present cash-crunch. You’ll be glad you did.

Categories: Finance

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