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Options for dealing with a major unexpected expense

Dec 5, 2011, 11:38 a.m.

If there's one thing I've learned in light of the recent financial crisis, it's that human beings have the potential to be incredibly resourceful, creative, and resilient when faced with an overwhelming financial burden. Whether it's paying for an important medical operation, replacing a damaged roof, or repairing a vehicle, your talents and intelligence can work to your advantage to conquer major unexpected expenses throughout your lifetime. It's possible that you have already gotten plenty of practice cutting corners just to make ends meet in your daily life. However, major unexpected expenses should be approached from a slightly different angle:

1. Pool your resources

It's perfectly natural to immediately respond to a major unexpected expense by thinking "There's no way I can afford that," but it's likely that you can afford a lot more than you think. Combine your savings, trusts, retirement funds, stocks, and excess capital to get a good understanding of exactly where you stand. Collect debts, add credit to the pool, and sell any valuable items in your home that aren't of sentimental value or an absolute necessity.

2. Downgrade your lifestyle

When burdened with a major expense, you'll have to cut corners wherever possible. This means shopping at the clearance rack and shopping less overall, cutting out unnecessary expenses (salon visits, dining out, expensive entertainment), and possibly even trading in your home or car for ones with lower payment requirements. It will seem like a big sacrifice, but you should consider yourself lucky to even have this option available, since many others don't.

3. Like Blanche DuBois, depend on the kindness of strangers

Although you might make some kind of profit panhandling in the street, a better solution would be to look into charity funding for your unique situation. Often when a major unexpected expense comes along, it is due to a terminal illness (or other medical issue), repercussions from a natural disaster, a lawsuit, or a death in the family. There are charity funding programs available for each of these issues, and you can even organize your own through your church or a community service organization.

4. Make money the old-fashioned way: Earn it

Working during your retirement is likely not what you had in mind, but sometimes it's necessary to help pay off urgent financial burdens. There are many quiet, undemanding jobs you can choose from, such as a librarian, substitute teacher, museum assistant, and so on to help make ends meet. Get creative and rediscover your talents to utilize for a profit-- whether it's selling your unique crafts and creations on Etsy or performing music or comedy routines at local clubs and lounges.

5. Take desperate measures

You may have to eat Ramen Noodles for dinner. You may have to work long hours. You may have to simply go without at times. Prepare yourself to make challenging and uncomfortable sacrifices when accommodating a major unexpected expense. You'll discover that you are strong and capable of much more than you ever imagined.

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