5 Ways the Federal Reserve Rate Cut May Affect You
5 Things to Think About When Looking for Extra Cash
April 14, 2020 by Eileen Loustau, SVP Marketing
According to the Washington Post, 6.6 million Americans filed for unemployment last week. This brings the total to over 17 million since the beginning of the COVID-19 pandemic.
Money may be tight right now. You’ve dug under your car seats and flipped the couch cushions. But before you post everything you own on eBay or sell your blood, here are five things to think about when looking for extra cash:
1. Beware of New Credit Cards
You may put yourself at risk for more long-term debt by getting a new credit card. Ideally you would only get a new credit card if there was a low promotional interest rate. Watch out for balance transfer fees from moving debt from one card to another; sometimes those fees can be as high as 3% of the balance.
2. Personal Loan
Use a personal loan to get extra cash and ideally pay off or consolidate your credit card debt. Personal loan rates are often much lower than standard credit card rates.
3. Borrow from 401(k)
Borrowing from your 401(k) could be a better option than taking cash out from the plan. You can borrow up to 50% of the balance (up to $50,000) and then pay yourself back and avoid the fees and penalties you might have to pay if you just take the cash outright when you are under the age of 59-1/2.
4. Share Certificates
If you have money tied up in a share certificates, you could avoid penalties and fees by taking out a lower interest rate share loan against your shares as you wait for it to mature. It’s important to note that these loans are specific to your credit union.
If you own a home, car, boat, or RV, check your interest rates. Now may be a good time to refinance so you can lower your monthly payments and put some money back in your wallet.
We understand that financial stability right now may be a little bit of a tight rope to walk. Chevron Federal Credit Union can help. We are your lifelong financial partners.
Please visit our CFCU Updates page for more information and FAQs regarding our active response to the coronavirus.