Tips to be credit ready for medical emergencies

Here are some important tips that can help to remain credit ready for medical emergencies.

The ongoing Covid-19 crisis has resulted in an enormous rise in cases of medical emergencies. The pandemic induced various lockdowns have further compounded the problem by reducing the income of many households.

Raghuvir Gakhar, CEO of PC Financial, “‘It is the health that is the real wealth and not pieces of gold and silver…,” Mahatma Gandhi has rightly said. Today, we understand this better when the pandemic has wreaked havoc resulting in a health emergency across the globe. We have learnt to prioritize health over everything else. However, at the same time, it is absolutely necessary to remain prepared for any unforeseen situation.”

Hence, the necessity to strengthen yourself financially is crucial. For instance, if a medical emergency arises, an individual needs to be equipped with sufficient funds that would enable them to deal with it.

Here are some important tips that can help to remain credit ready for medical emergencies;

Emergency fund – Experts say there is nothing more important than maintaining an emergency fund that would bail you out of any difficult situation. Ultimately, the amount of the emergency fund should be enough to cover at least 6 months’ expenses. Further, financial planners advise, never to keep the whole emergency fund in a savings account.

Gakhar says, “Invest some of it in equities that are easy to liquidate. It will help earn better returns and also ensure availability in case of an emergency. One must make it a habit to keep a certain amount from every month’s income for the emergency fund.”

Medical insurance – With the current trend in rising medical costs, it is impossible to pay for such huge medical bills at the hospitals and that too from a monthly salary. Hence, it is vital to have health insurance for the whole family.

Gakhar adds, “While the organizations provide medical insurance cover, one must not rely on it completely due to the current job market situation. There are several companies offering medical insurance with a range of coverage.” Choose a plan that suits you and your family better.

Life insurance – Life insurance plays a pivotal role, especially if you are the sole earner in a family. It is beneficial as it can empower families to face any medical emergency situation with sufficient funds at their disposal. According to IBEF (India Brand Equity Foundation), the expected annual growth of the life insurance industry in India will be 12-15 per cent over the coming 3-5 years.

Quick personal loans – Considering the financial urgency of their own customers, lots of banks provide instant loans. Such loans do not go through a lengthy process of approval, hence, can be opted for instantly. During a situation of medical emergency when in need of funds, it is a worthwhile option to opt for loans from such banks.

Gold Loan – Banks offer loan against gold jewellery and a customer in emergency requirement. This can quickly range anywhere from Rs 10,000 to Rs 1 crore with gold jewellery.

Gakhar says, “This is a convenient option when someone is facing a medical emergency and needs funds. Its easy application process makes it one of the easiest options for quick credit.” Furthermore, it must be noted that the interest rates are nominal because gold acts as good security for repayment of the loan.

In a nutshell, there are a variety of options for a quick credit during an emergency but one needs to be aware and prepared always.

Industry experts say, even though one can never be fully prepared for a medical emergency, it is only smart to know what all credit options are available.