It takes vulnerability to ask for help of any type, and it can be especially tough when it’s about asking for financial help. However, reaching out to people for help when you’ve fallen on hard times or when you need a medical bill might actually help you get back on track to financial security. Here’s a guide on how you can ask for and get financial help, even with bad credit.
When To Know It’s Time To Get Financial Help
If you’re attempting to get out of debt but constantly find yourself in any of the following scenarios, you should know it’s time to get financial help.
#1. You’re constantly taking out from your savings
If you’ve had to tap into your savings on a regular basis due to financial setbacks, it’s time to rethink your situation. Using credit cards to pay for living expenses is another clue that you require additional assistance.
#2. You are overdue on your bill payments.
Do you get calls from debt collectors on a regular basis? Or were you sent to collections? When it’s tough to pay your payments on time, your financial condition might swiftly deteriorate.
#3. You are incurring further debt.
Opening new credit cards or taking out loans to cover unexpected expenses is another clue that you could benefit from financial aid.
How To Get Financial Help
You may believe that asking for help is a sign of weakness, but expressing vulnerability and asking for financial help requires courage and fortitude. If you’re not sure where to turn for assistance, crowdfunding is one of the simplest and most successful ways to reach out to a large number of people at once and express your requirements. Here are some tips to guide you:
How To Ask For And Get Financial Help
#1. Tell an honest and vulnerable story
Although it may be uncomfortable to disclose your financial specifics in your fundraiser tale to friends and strangers alike, this is precisely what will compel others to assist you. If people understand why you really need money, they will be more ready to donate to your cause—or perhaps share your fundraiser with others.
- Explain in detail how you got to your current situation in your message requesting financial aid.
- Remember to clarify how this hard patch is affecting your emotional well-being in addition to the financial consequences of your circumstance.
- Describe how financial assistance will make a significant difference in your life.
- Lay out your plan to get back on track in as much detail as possible to develop trust.
#2. State your objective clearly.
Set a sensible and reachable fundraising goal to tap into the psychology of donating. According to research, there is a correlation between tangibility and generosity, which means that people are more ready to donate to a cause if they feel their contribution will have a tangible effect.
As a result, when soliciting donations, it is prudent to set a sensible and feasible fundraising objective. If your overall debt is $10,000, setting a fundraising goal of $3,000 could be a better choice. People will be considerably more inclined to help if they believe their contribution will have a significant impact. You can always raise your target at any time.
#3. Volunteer your time
Some friends or family members may have inquiries about your financial situation or wish to offer you emotional support. Offer to meet with anyone who wants additional information about your circumstance at the end of your fundraiser story. Your openness and willingness to make time for them will go a long way.
#4. Request financial advice.
You’re bound to have a few financially savvy friends and family members among your network who are eager to share their knowledge with you for free. Let your supporters know in your fundraiser story that you’re willing to receive financial advise in lieu of or in addition to monetary help. Your network of friends and family members will realize you’re serious about taking control of your future if you exhibit an interest in financial literacy and a willingness to learn and grow.
#5. Show your appreciation
One of the most crucial components of fundraising is thanking your donors for their contributions. When individuals feel valued, they are more likely to donate again or to spread the word about your cause. You can thank donors in a variety of innovative ways, ranging from a fundraiser update to a handwritten fundraising letter.
How To Get Financial Help With Bad Credit
Here are some options for getting financial help if you have bad credit:
#1. Payday-alternative loan
Payday-alternative loans are provided in small sums from chosen federal credit unions and have short repayment terms. You can borrow up to $2,000, which is normally repaid over one to twelve months.
The interest rate you receive is determined by your credit score; people with poor credit typically receive the maximum interest rate, which is capped at 28 percent. You must be a member of a credit union that offers this loan product in order to apply.
#2. Credit card cash advance
Some credit cards offer cash advances, which allow you to withdraw amounts from your credit line. You can take dollars from an ATM or a bank branch up to the cash advance limit or available credit on your card, depending on the card issuer’s requirements.
Credit card companies charge a transaction fee, often between 3% and 5%, to use this facility. Furthermore, because there is no grace period, you will immediately incur interest on the amounts borrowed.
#3. Payday loan
Payday loans are unsecured, short-term loans for modest amounts. Most are limited to $500 and are due within two weeks of your following payday. Payday loans are widely accessible to borrowers with negative credit because they do not require a credit check to be accepted.
However, lenders demand exorbitant interest rates for payday loans. Furthermore, payment is frequently expected by ACH withdrawal, and failure to have the cash available when the loan becomes due typically results in costs from your financial institution. If you live in a state that allows rollovers, it comes at a cost that can trap you in a vicious debt cycle.
Payday loans are absolutely prohibited in several states. Others set lending limitations that specify interest rates and fee caps.
#4. Title loans
Title loans are secured loans in which you must surrender the title to your vehicle as collateral in return for cash. Most lenders allow you to borrow between 25% and 50% of the value of your car.
Title loans, like payday loans, should only be used as a last choice for a variety of reasons. If you are unable to make your loan installments, you risk losing your vehicle. These loans also have high interest rates and a short repayment time, which might put a strain on your finances if the monthly payment is significant.
Alternatives To Loans
If you choose not to utilize credit to handle a financial emergency, the following non-loan options may be suitable:
- Seek assistance from a charity or a local nonprofit: Call 211 to find out more about financial assistance in your community or through your state.
- Request a salary advance: If you’ve been at your employment for a while, request a pay advance on your next paycheck.
- Request a loan from a friend or relative: They may be ready to grant you an interest-free loan, but be sure to put the agreement in writing.
- Make financial arrangements: If you require quick cash to meet your monthly financial commitments, call your lender or creditor and request an extension.
- Borrow against your 401(k): Some 401(k) plans allow loans of up to $50,000 or the vested balance, whichever is less, with the interest paid credited back to your account. Keep in mind that taking this method may have an impact on your retirement savings because there is a significant tax reduction when drawing from your 401(k).
How to Get Financial Help For A Medical Bill
#1. Request and carefully examine an itemized bill
Medical bills and insurance statements can be difficult to understand, but a thorough examination could save you money.
Your insurance company may send you an explanation of benefits (EOB), which is a preliminary report of what your insurance covers rather than a bill. You may potentially receive many EOBs for various appointments or treatments. Separately, the health care provider may send you a bill for charges not covered by your insurer, such as deductibles or copays. You can get a line item estimate of service prices before receiving your statement, and if the bill you receive isn’t detailed, you can request an itemized bill.
Examine all documentation carefully for problems such as double billing, procedures or equipment that were not completed or used, erroneous operating room timings, and expenses that your insurance should cover. Also, ensure that the EOB corresponds to the bills you receive.
Medical billing is tricky, and errors sometimes occur. Detecting and reporting the error to the medical provider’s billing department or your insurance company can save you money.
#2. Examine Medical Bill Repayment Plans
After you’ve confirmed that the bill is correct, contact your healthcare provider to explore payment options. Some of these may help you stretch the expense over time or save you money in the long run.
- Full-payment discount: Some medical providers may give a discount if you pay the bill in full as soon as possible. Of course, this isn’t for everyone, but it’s worth asking whether you can cover 80% or more of the expense.
- Down payment discount: If you can make a significant down payment and agree to pay the rest of the bill over time, you may be able to earn a discount.
- Planned payments: If you can’t afford to pay the amount right now, your medical provider may offer payment arrangements. You might even get a low- or no-interest plan, which might save you a lot of money over taking out a loan to pay the payment.
Many hospitals and medical organizations provide payment plans—49% of providers offer payment plans, according to a HIMSS Analytics survey—and can come in handy if you’re not sure how you’ll pay for your medical services. If you are offered a discount or payment plan, get the conditions in writing and strictly adhere to the rules of the accommodation.
#3. Think about hiring a Medical Billing Advocate.
If you’re feeling overwhelmed or stuck, you could employ a medical billing advocate to work on your behalf.
The advocate may go through the same steps as stated above, such as reviewing your EOB and bill and discussing payment options with your medical provider. However, their experience and skills may assist them in detecting problems or determining which options your supplier typically provides. Advocates can also attempt to bargain on your behalf, attempting to have fees and bills waived or reduced.
Although medical billing advocates charge a fee for their services, they may be able to save you hundreds or thousands of dollars. You may pay an advocate hourly, per project, based on how much you save, or a monthly charge (when retaining an advocate for ongoing services).
#4. Look for Financial Assistance and Charitable Programs.
You may be eligible for financial support from a variety of programs, including those run by the government and non-profit groups. The programs’ availability and eligibility can vary greatly depending on where you live and your condition, but they generally aid low- to moderate-income households. Here are some examples of providers and programs:
- Pharmaceutical companies
- Medicaid
- Medical professionals
- CancerCare
- HealthWell Foundation
- Leukemia & Lymphoma Society (LLS)
- Patient Access Network (PAN) Foundation
#5. Use a Loan Only as a Last Option
If you can’t get on a low-cost payment plan or find adequate support elsewhere, you can consider taking out a loan or using a credit card to pay your medical payments.
Loans and credit cards (including medical credit cards) typically have interest rates and fees that contribute to your overall costs. You should also be cautious about utilizing a secured loan to pay for medical expenditures, such as a home equity loan or line of credit because they can lead you to lose your property if you fall behind on payments.
However, there may be a few exceptions. For example, if you have strong credit and a steady income, you might be able to get a low-interest personal loan. Alternatively, you may be able to obtain a credit card with an introductory 0% annual percentage rate, allowing you to repay the amount over time without incurring additional interest.
- How to gain customer loyalty. [8 easy ways + case study]
- Employment Lawyer In New Jersey: The Best Employment & Unemployment Lawyer New Jersey
- Social Marketing Strategy: Definition & Examples
- Seven Ways Unions Protect Employee Rights
References
