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Sunday, December 14, 2014

Tip 68: How to cut expenses quickly in a financial emergency

Tip 68: How to cut expenses quickly in a financial emergency

What can you do to cut your expenses quickly in a financial emergency?  Maybe you just found out that you lost your job or that you have a big unexpected expense.  What can you do quickly to survive with less cash?

Here are some actions to consider quickly reduce your spending:
* Sell a car
* Cut your newspaper
* Cut cable TV or satellite TV
* Cut internet service (use cell phone data plan instead)
* Cut kid's activities (piano lessons, sports)
* Cancel travel for vacation and family events
* Stop eating out, stop going out to movies
* Sell any expensive toys that you have and are making payments on such as boats, travel trailers, and campers
* If you are renting a storage unit, empty it out and stop paying
* You may be able to arrange to "skip a payment" on some of your credit cards and loans.  You'll still pay the full amount, plus interest, but this will give you some time to get stabilized again.
* Sell unneeded items at a garage sale or take them to a consignment shop to sell
* Take credit cards out of your wallet and go with cash only.  It is psychologically harder to spend cash and you will be painfully aware of how much money is leaving your wallet.
* There are also lots of things you can do to make some money quickly.  I am focusing this book on spending less money, I plan to cover easy ways to make money in a future book.

The strategy to deal with a sudden drop in available cash is to quickly reduce you spending to compensate.  This list should provide some ideas on things that you can move on quickly to reduce your spending to have more money available to deal with basic needs.  Depending on your situation, you may also want to look at finding another job or otherwise increasing your income.

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