When You Need Money: How to Get Funds
Money can’t buy happiness, but it pays for many of the things we regularly need, and a shortage of funds can make things harder. When you need money, you can raise cash in several ways. Some of them are faster than others, and we’ll cover each of these strategies (and more) in detail below.
- Sell things.
- Negotiate upcoming payments or debts.
- Trade your time for money.
- Borrow money (with the right loan).
- Cut costs.
- Find support and assistance.
- Ask your network.
When you need money quickly, try selling items you no longer need. That includes clothes, collectibles, gift cards, items for your hobbies or sports you play, and more. With craigslist and a deep pool of buyers, you may be able to get the money you need within a few days. But you can only sell so much—it’s not a long-term solution—and selling isn’t a solution if you need more money than your belongings are worth.
Negotiate Your Payments
Communicate with lenders if you’re having financial troubles. They may have several options for postponing or changing your payments.
Avoiding foreclosure: You may be able to participate in a debt workout program with your lender. They prefer to work things out with you and avoid the foreclosure process (as do you). See how debt workout programs work, or investigate government refinance programs designed for homeowners in a tight spot.
Student loan payments: If your income is low or you’re unemployed, you may be able to temporarily postpone payments or reduce your required monthly payment. Ask your loan servicer about income-driven repayment options and other forms of relief. You’ll need less money for monthly payments, and you may be able to get back on your feet.
Other creditors: It’s possible to negotiate payments with almost any creditor. For example, some medical offices allow extra time for payment, credit card companies might take a reduced payment, and even the IRS is open to offers.
Get help: If you need help with money problems, credit counselors can help you take control of loan payments, and you might not have to pay for these services. They can also help you evaluate options like debt management plans, bankruptcy, and more. If all goes well, they’ll help you find a way out of debt relatively quickly.
Earn Extra Income
More income could have a dramatic effect on your financial situation. While spending less each month is important, it's ideal to increase your earnings at the same time so you can stay on solid ground for the rest of your life.
You can earn more income in several ways.
Start a side gig: If you go into business for yourself, you'll increase your earnings without having to quit your day job (or without even needing a day job). There are numerous options—figure out what you're good at, what you're interested in, and what people are willing to pay for. To get the creative juices flowing, there are some great ideas here.
Improve your skills: Sometimes education can help you land a job (or a better-paying job than the one you have). In fact, education is linked to higher earning power. If you need an undergraduate degree, start the process, or look into advanced degrees or professional certificates.
Land your dream job: If you've hit a plateau at work (or if you need a job), find work that will support the life you want. The process can be challenging, but people get new jobs every day—even in a bad economy. For tips on how to make the process less challenging, browse the Job Search pages.
Borrow Money Wisely
Borrowing is another way to get the money you need quickly. However, borrowing can easily spiral out of control, and you pay interest when you borrow. That said, wise borrowing can help you improve your situation, and using the right loan for the job helps you avoid problems.
Auto loans: If you need money for transportation, an auto loan may provide what you need. Be sure to keep your loan under five years or you'll likely find yourself “upside-down” on the loan and unable to get rid of the car. The most important thing to know when buying a car is to focus (and negotiate) on the purchase price. Don’t focus on the monthly payment, because it’s easy for dealers to give you any payment you want.
Student loans: The US government is eager to help you further your education, and federal student loans come with several borrower-friendly features. If government-backed loans are not available, private loans are also available (but don't take any private money until you've investigated federal student loans). Your first step to borrowing for school is to complete the Free Application for Federal Student Aid and check with your school’s Financial Aid department for additional resources.
Home loans: The place to start is the Mortgages 101 page. You’ll find out how to get the best mortgage, and you’ll learn how those loans work. Educating yourself helps you understand how much you're spending on interest and how to get approved.
Home improvements and repairs: Homeowners often use home equity loans to fund home improvement projects. It’s a good way to get a sizeable loan at a decent rate. But you need equity to use those loans. If that’s not an option, consider grants and resources to get the money you need. To buy or refinance and make improvements at the same time, consider a government-backed FHA 203k loan or PACE funding.
Need money for loan payments? Some borrowers benefit from a debt consolidation program. Of course, the strategy can only shift your debt—you don’t eliminate debt by consolidating. For some, this approach leads to temptation to spend again, so develop a plan to keep your debt levels low. When used correctly, debt consolidation can help you pay less in interest and eliminate debt more quickly.
One of the fastest ways to free up money is to spend less. It's easier said than done, but you can improve your chances of success if you have a plan and if you get great ideas from people who've already been there.
First, get a handle on your spending and figure out what you can cut (it's not fun, but it needs to be done—at least temporarily). For instructions on how to do all of that, see How to Trim your Budget. You may also be able to save money by joining a time bank and spending time (possibly with others) instead of money.
Ultimately, cutting costs only goes so far. You may need to use other strategies in addition (such as earning extra and negotiating payments).
If you need money for basic needs like housing and food, you may be able to get help from local government and nonprofit organizations. Ask your city or county Department of Health and Human Services (or similar) for suggestions. They may be able to provide resources with no need to repay what you receive. Other local organizations might also have ideas on how you can make ends meet.
Ask for Money
If you have friends, family, or an extended network, you can try asking for money. That's easier than ever with crowdfunding platforms. You can potentially get money for anything you can imagine: medical care, artistic projects, starting a business, education, disaster recovery, weddings, and more. Investigate any crowdfunding partners carefully, and ask an attorney and accountant for advice on how to handle any funds you receive. These programs can bring in a significant amount of funding, but they can also create complicated challenges.