Tapping any retirement account for emergency funds
is something you want to avoid unless there are no alternatives.
You don't want your account to stop growing, or to give up matching
funds and tax deferral, and you certainly don't want to pay penalties.
It's a Bankrate mantra, but one that works wonders when people stick
with it: Quit using credit cards.
Credit cards are one of the most expensive forms of
money. Unless you're in the habit of paying off your credit card
bills each month, don't use the cards for anything you can eat or
"Consolidate your debt. If you have
several credit cards at 13-, 14-, 16-percent interest,
fold them into a home equity loan and write off the
interest payments," says Grzymala.
Experts also differ a bit on that one.
"A home equity loan, that's borrowing,"
says Cooper. "Use that option after using Roth
contributions and, possibly, tapping into the equity
in your life insurance."
Clearly, there are options that are riskier than others
and an option that's appropriate and appealing to one person may
make another person cringe.
||Here are some suggestions
for budget trimming:
It may not make you the most popular parent on the
block, but you'll be doing your children a favor by teaching them
to be frugal and to develop good spending habits.
Saving money on your own takes discipline but,
like most other things, it becomes easier over time. The peace of
mind that comes from knowing you have financial resources for when
times are rough can be worth the sacrifices you make now.