How Can You Handle Surprise Expenses?

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Some surprises are great! Surprise parties, surprise cakes and surprise bonuses are all types of surprises that you’ll be happy to encounter. But surprise expenses? Not so much. 

Unfortunately, you can’t stop surprise expenses from happening, but you can prepare to handle them at a moment’s notice so that they don’t completely ruin your day.

An Emergency Fund

An emergency fund is a collection of savings specifically reserved for surprise expenses like urgent home repairs, car repairs and dentist appointments. When you encounter a surprise expense, you can simply withdraw the necessary amount of savings from the fund and pay for it, all without affecting your budget for the rest of the month.

How can you start building your emergency fund? Start by calculating how much you can set aside in your budget for this purpose every month. Put those funds into a savings account, and don’t touch them unless you absolutely have to. Repeat this step and watch the fund grow. 

A Credit Card 

What if you don’t have an emergency fund? Then, one of your options for handling a surprise expense right when it happens is your credit card. You can charge the expense to your credit card immediately. After the issue is resolved, you’ll have to dedicate your efforts to slowly paying down your credit card balance.

You should avoid this solution when your credit card’s balance is already quite high. Adding another expense onto the balance could push it too close to the limit — or worse, you could end up maxing out your credit card. Maxing out your credit card can come with several unpleasant consequences, including a raised interest rate and a lower credit score.

A Personal Loan

Another option for handling a surprise expense is a personal loan. You could go to a website like CreditFresh and fill out an application for a personal loan. If you’re approved, you can use the borrowed funds to deal with the emergency in a short amount of time. After using those funds, you will need to follow a steady repayment schedule. 

Online personal loans aren’t for every type of expense. You should only apply for them when it’s an emergency, and you don’t have any other easy alternatives to rely on. Never use them for everyday expenses or to buy things on your wish list. 


A different type of “personal loan” that you can try to access in an emergency is an IOU from a friend. If they have enough funds readily available, they just might be able to give you a quick loan to help you get through an emergency. 

There are two big issues that come with IOUs: 

  • You can’t be sure whether your friend will have the money that you need at the drop of a hat. They aren’t a bank. Even if they want to help you resolve this urgent problem, they might not be able to afford it.
  • You could permanently damage your friendship because of a loan. So, if you’re not sure whether you can pay your friend back quickly, you should rethink this solution. It might not be worth the emotional risks that come with it. 

It’s always good to be prepared, especially when it comes to emergency expenses. Now you’ll know what to do when you get caught by surprise.

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