How to Cope with a Financial Crisis in Your 50s

By on February 15, 2018
How to Cope With a Financial Crisis in Your 50's

By Jenna Brown—

Managing your money has been something you’ve been told to do since you got your first job. When you were younger, making financial mistakes, although impactful, was a lot easier to bounce back from. If you didn’t save in your 20s you still had a few decades before you hit retirement to figure it out. If you’d filed bankruptcy in your 30s, the 7 to 10 years it takes to recover, was easier to wait for. However, now that you’re nearing retirement and much older, when faced with a financial mistake or crisis, dealing with it isn’t as simple.

Though emergent situations can occur at any age, it is essentially the decisions you made when you were younger that will determine how easily you can handle the matter. Ineffective financial management can put you in a situation where you have no choice but to look to others for help. If you’ve found yourself in a bind at the age of 50, there are fortunately still options available to you.

Ask Family

The first place to turn when you’re struggling financially is to those that care about your well-being the most – your family. Turn to a few trusting members of your family with your troubles and see if they are willing to help you out. If they do loan you the money, be sure to pay them back in a timely fashion to avoid burning a bridge or your relationship with your loved ones.

Borrow Online

When family members are equally struggling and traditional banks turn you down, one option that is becoming increasingly popular is borrowing from an online lender. Service providers like Blue Trust Loans will provide eligible applicants with as much as $1200 to handle short-term financial emergencies. So, if you have a past due bill, the car suddenly breaks down, or you need to make a home improvement, this would be a quick solution to consider.

Home Equity Loans

If you happen to be a homeowner, and the financial crisis has nothing to do with your mortgage payments, you have the potential to borrow on the equity in your home. Though reverse mortgages are the best option as it is money that doesn’t need to be repaid, it is essentially only available to those who are 62 years of age or older. Therefore, your best option would be to consider a home equity loan. This is a loan based on the amount of equity in your house. Keep in mind, the funds must be repaid in order to prevent foreclosure or further collection on your property.

Retirement Accounts

Have you been contributing to a retirement or pension account either through your employer or with a bank? If so, you do have the option to borrow from the account to handle your financial crisis. Some accounts allow you to borrow as much as half of what you have accumulated with low-interest rates. Keep in mind, however, you will have to repay the loan in full in order to prevent early withdrawal penalties. If you’re close to retiring, it may not be the best option since you obviously won’t pay the funds back in full before your ideal retirement date.

Downsize

If your financial crisis is something serious or long-term, you may need to take more drastic measures. This might mean needing to downsize. Whether you sell things you no longer want to get rid of things around the home or you decide to move into a smaller house or apartment, it can generate money that you didn’t have previously and help keep you afloat financially.

Start a Side Hustle

Do you have anything you’ve ever been passionate about that could make you some money on the side? It’s never too late to chase a dream – especially if it can help you out of a jam. Start searching for side hustles that you can complete with little to no startup costs. Whether you babysit neighborhood kids or teach them how to play the piano, the additional funds can help reduce your financial debt.

Everyone falls on hard times. However, when you’re older, bouncing back can seem like an impossible task. Fortunately, there are options available for those struggling at the age of 50 or any age for that matter. All above-mentioned options should be reviewed carefully before trying to determine which will work best for you. Should you decide to borrow money, be sure to repay it to prevent falling into deeper trouble, or burning bridges of resources you may need in the future.

About lb50

Leave a Reply

Your email address will not be published. Required fields are marked *

How to Cope with a Financial Crisis in Your 50s