Best ways for getting instant money during emergency

Our life has changed a lot since March 2020 due to the effect of Covid pandemic. The pandemic resulted in an enormous rise in medical emergencies and almost inevitably a simultaneous need of emergency funds. An individual needs to be equipped with sufficient funds that would enable him/her to deal with it. Here are important tips that can help you to remain credit-ready for medical or other emergencies.

Emergency fund

Emergency fund is the best option to tackle any emergency situation, medical or otherwise. You should have at least six months of expenditure in your bank account so that you can face any adverse situation with a cool head.

Experts say there is nothing more important than maintaining an emergency fund that would bail you out of any difficult situation. It should have a minimum amount that can see you for six months.

Investment advisors also say that at least half of the fund should be invested in some equity-based instruments that are easy to liquidate. It will help earn better returns and also ensure availability in case of an emergency.

Liquid funds

Withdrawing from a liquid fund is also not very difficult. It will take maximum 24 hours to redeem. A liquid fund is one of the most accessible instruments. It also offers returns of around 7% which is more than double of what savings accounts offer.

When it comes to investing for a really short time period and create a contingency corpus liquid fund is an ideal choice, explained Nilotpal Banerjee, a personal finance professional.

There are other instruments too such as overnight funds, ultra-short-term funds, the proceeds of which may be realised quickly. Overnight funds can also be ideal for instant encashment.

Gold loan

Banks offer loan against gold jewellery to a customer in an emergency situation. These can quickly range anywhere from Rs 10,000 to Rs 1 crore by pledging gold jewellery. Gold loans are sanctioned within a few hours. This is one of the best options in emergency.

Personal loan

Considering the financial urgency of the person, lots of public and private banks provide instant personal loans. Such loans do not go through a lengthy process of approval, and therefore, the cash becomes accessible quickly. One can get as much as Rs 10 lakh loan instantly if the person has a good track record and that too within couple of hours.

Medical insurance

If you have any medical emergency, medical insurance can play the most important role. With constant rise in medical costs, it is impossible to pay for such huge expenditure in cash. Hence, it is vital to have a health insurance coverage for the whole family.

Life insurance

In these tough times life insurance plays a pivotal role in our life, especially if the person is the main breadwinner in the family. It is beneficial as it can empower family members to face any unforeseen emergency situation with sufficient funds in hand. So, it is advisable to have a life insurance many times more than your monthly expenses.