There are many people that tend to view their credit cards as an emergency fund or something that they can trust if there is some type of financial emergency. If you have a regular monthly budget of $6000, it’s likely that you will have a credit card with a $12,000 limit. If your car breaks down and you need to pay for repairs of up to $3000 that are above your monthly budget, it can be very tempting to simply charge those repairs and not pay them off carrying a balance for a few months.

Having a cash emergency fund or a small amount of money that you save over a few months can make sure that you have something available when these unexpected expenses start to hit. The nice part about having an additional cash account is that even if an expense comes up, you can drain the account and there’s no need to pay any extra interest on the money that you used to pay for the emergency.

A credit card on the other hand can make it difficult to pay off what you owe. Even carrying a balance for a few months and paying the minimum payment could have you accruing tens or even hundreds of dollars in extra service fees. A credit card loan is a dire financial solution and it can often make matters worse when you are facing an expense one month and then facing the repayment of that emergency withdrawal from a credit card the month after. Although emergencies will happen, you can establish a choice for yourself by working to control your finances and building an emergency fund today. Focusing on your future and building a proper emergency fund can make sure you don’t have to turn to credit in the future in order to manage your finances.

This post was written by Trey Wright, one of the best Bankruptcy Lawyers in Tallahassee Florida. Trey is one of the founding partners of Bruner Wright, P.A. Attorneys at Law, which specializes in areas related to bankruptcy law, estate planning, and business litigation.

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