No emergency savings? This Is a Safer Way to Pay for an Unexpected Purchase to Avoid Debt – The Motley Fool | CarTailz

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A costly bill can be stressful, but it doesn’t have to be your fault.


Important points

  • You can feel stressed when you have an unexpected bill to pay and no savings.
  • There are other ways to pay for emergency expenses without an emergency fund.
  • You may be able to get a 0% APR credit card to help you pay off a purchase and avoid interest debt.

No matter how much you plan, there will always be unexpected situations in your life. Unfortunately, you may also have to deal with unforeseen expenses.

If you don’t have an emergency savings fund, figuring out how to pay a surprise bill can be stressful. There’s a solution you might want to consider the next time this happens that might help you avoid expensive credit card debt.

Unexpected expenses can happen to anyone

Whether it’s an unexpected medical bill, car repair bill, vet bill, or plumbing bill, owing a large sum of money when you least expect it can be frustrating—especially if you’re already tight on money.

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With higher prices everywhere, many Americans are struggling to maintain adequate emergency funds. It can feel impossible to save when almost everything has gone up in price.

But if you have an unexpected bill to pay, try to see if there’s a solution that doesn’t put you in debt. There may be a way to cover the costs without jeopardizing your financial health.

Use a 0% APR credit card to avoid paying interest

One way to avoid debt is to use a credit card with a 0% APR promotional period. Many of the best 0% APR credit cards offer no interest for 15 months or more.

This gives you time to pay the unexpected bill without interest. You can split the total debt into smaller monthly payments. Just make sure you pay off the entire balance before interest kicks in. Credit card interest can be expensive.

Imagine you get a $2,000 vet bill and you have no savings. When you apply for a 0% APR credit card that offers 15 months with no interest, you can pay less than $140 a month and pay off all of your debt before the end of the promotional period.

This is a much better solution than charging a credit card you already have and paying interest while you slowly work to pay off the balance.

What you should consider before buying a new credit card

If you’re planning to apply for a new credit card, do some research first. This way, you get a credit card that suits your financial needs. Consider the following:

  • Verification Fees. Does the credit card have an expensive annual fee? Will you be charged foreign transaction fees if you use the card internationally? The fees can add up, so it’s important to know what you’re being charged before getting a new card.
  • Know where your credit stands. You should also know your creditworthiness and credit score. Knowing this allows you to apply for a card with a good chance of approval rather than risk being turned down (and subjected to a harsh credit check) for a card that doesn’t suit you.
  • Check the reward potential of the card. Does the card offer rewards? If so, it’s a good idea to review how rewards are earned and what types of redemptions are possible so you have a plan for using your rewards.
  • Check the advertising details. If you’re taking advantage of a limited-time promotion like 0% APR, make sure you know how long the promotion period lasts before you get the card. That way you know what to expect and there are no surprises later.

Check out our list of the best credit cards to learn more about card options.

Don’t let unexpected expenses get you down

If you recently received a large unexpected bill, don’t let it get you down. There’s probably a way to pay the bill without taking on new debt. You may need to get creative, but find the best solution for your financial situation. We all do our best.

Check out our personal finance resources if you’re looking for additional tips on how to better manage your finances.

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