Homelessness is one of the most pressing issues in modern society, but most Americans don’t fully understand the issue or imagine that it could happen to them. Oftentimes, when middle-class citizens see someone asking for money in front of the store, they walk right by and act as if the person on the street is a world away from them.
The reality is that the tough economic times we are living through in the post-pandemic world have made homelessness something that could happen to a big portion of the population. It takes careful planning and a decent-sized savings account to make sure that you are protecting your family from losing their house.
Homeless car insurance is important for those who live in their car after becoming homeless. We’ll talk about some of the mistakes and bad luck that lead to homelessness and how everyone can avoid becoming homeless themselves.
#1 – Not Having an Emergency Fund or Savings Account
People often think of emergency preparedness as having essential items in a safe place that can be accessed during times of trouble. A bag with water and a flashlight, among other things, is often the go-to when you can’t get your typical supplies during an emergency.
What people often don’t think about is that preparing for an emergency also means having funds in reserve in case times get tough. When you live paycheck to paycheck, you are one missed week of work away from potentially being homeless.
Sometimes expensive things happen in your life that can’t be avoided. Perhaps an appliance like your washing machine or your furnace breaks down or you get injured. Maybe the water company raised the monthly bill but you don’t have enough money to pay it without tapping into a savings account.
This is when it becomes so crucial to have more money than just your paycheck. You have to possess enough cash to pay for emergency purposes otherwise you risk losing your home and becoming homeless.
Think about how you can contribute to a savings account each month without putting yourself into a tough spot. Classic methods like taking spare change in your purse, skipping a morning coffee and putting the money into savings can be effective ways to collect some extra cash.
Investing is another way to bring in more money. Cryptocurrency is simple and fresh. Everyone wants to get in on the virtual world right now, and it’s an easy way to make extra income without risking too much of your money. Talk to an investing expert before making any investments that you are inexperienced in.
#2 – Losing Your Job
Losing your job is devastating, and for some, it can lead to homelessness. If you have no other source of income, employment loss is especially damaging to your financial security. One of the ways to secure extra money in case of job loss is to find a side hustle or a source of passive income.
Find a hobby that can also make you some money on the side. If you enjoy fixing computers or other technology, start a vlog online and get some additional income from affiliate advertising. Maybe you enjoy being outside on the weekends. Mowing lawns for your local neighborhoods can be an effective way to make more money.
Choose something that makes you excited and can be easily executed in your off time. Don’t choose a side hustle that detracts from your full-time job or could potentially see your performance suffer to the point of losing that job.
Control what you can at your main job so you are more secure within your company. Listen to what your boss tells you to do, but don’t let them take advantage of you. It’s always better to find somewhere that values all of your skills. This brings you job security and happiness in the long run.
#3 – Having a Breadwinner Die
Families are at risk of becoming homeless if they are being supported by a sole breadwinner. This is why it is important for more than one person to bring in money in a family. No matter how many people are working, all families should look into getting a life insurance policy if they have young children.
Life insurance is not something that young adults think about very often, but they should if they are responsible for others. Life insurance is going to be very affordable for people in this age group if they are healthy and don’t have a job which puts them at risk of dying.
If you smoke, drink excessively, or do drugs, you are going to have a harder time getting a life insurance policy. Do whatever it takes to get life insurance so that your family is not homeless if an unexpected tragedy strikes and leaves them without their breadwinner.
#4 – Spending Too Much After Becoming Rich
People often think they have made it in life if they become a millionaire. The issue with having this excess of cash is that your perspective on spending too much changes. When you are middle-class or lower-class, you try hard to budget and save. When you have a high income, sometimes it gets tempting to buy luxurious items and make other unnecessary purchases.
This is evident by the number of professional athletes that have struggled to pay for their debts or filed for bankruptcy at some point in their life. They buy mansions, sports cars, big yachts, and other extreme items that are not smart for their bank account. It all adds up and suddenly they have no money left.
If you are ever in a situation where you have a lot of money, understand how volatile this can be. You are still closer to losing everything than you think. Consider living like a middle-class person still.
You don’t need to live in low-cost housing, but you also don’t need to live in a palace. Buy an affordable residence and car, and live with some humility. It can be tempting to flaunt your wealth with fancy stuff, but it’s also incredibly risky in the long term.
Hopefully, you can see that homelessness is an issue that affects more people than you think. If you don’t spend carefully and save, you could also end up on the streets asking for money. Don’t pass judgment on those people, and try to help them out so they can get back on their feet.
Shawn Laib writes and researches for the car insurance site, CarInsuranceComparison.com. He wants to help people learn better spending habits so they can avoid homelessness.