People need a ready source of cash for all sorts of reasons. Sometimes it’s to deal with the record inflation, loss of a job, a surprise medical bill, or the need to fatten savings accounts. What are the most reliable ways to squeeze extra funds from an apparently tight budget? Besides selling an unneeded second car, many working and retired adults turn unwanted life insurance policies into ready-made cash.
Others take advantage of similarly creative tactics, like holding online sales of their surplus personal belongings, applying for low-interest loans, renting out spare bedrooms, pulling money out of built-up home equity, banking tax refunds, and putting For Sale signs in front of their rental or vacation properties. As the 2023 economy continues to sputter, more and more citizens are seeking previously unexplored financial resources. Consider the following ways you might be able to convert unused, unwanted, and hidden assets into cold, hard cash.
Unneeded Cars
It’s surprising to think of how many second cars go unused. People are sometimes reluctant to get rid of their favorite vehicles, and they assume they’ll need an extra car at some point in the future. Even after it sits in the garage untouched for a year or two, they rarely entertain the idea of converting it to cash. Amounts vary, but unloading a seldom-used or never-used vehicle can fetch many thousands of dollars for owners who try to repair and upgrade the vehicles before selling them.
Don’t be afraid to invest a modest amount of funds into mechanic fees, a paint job, and a thorough interior cleaning. The used car market has never been hotter than it is now, as prices for brand-new passenger vehicles reach record highs. Keep all paperwork, whether you sell to an individual or a dealer, and don’t forget to report the sale on state and federal tax forms.
Life Insurance Policies
Unwanted or unneeded life insurance policies are among the most fruitful of all unexpected sources of money. The first step for anyone who has a policy they’d like to sell is to learn the potential selling price. Next, it’s essential to review the process for converting the coverage into ready cash.
Resources like Policy Bank are an ideal place to begin gathering all the pertinent information. Fortunately, sellers can find out the relevant facts online in just a few minutes. Exploring the possible value of life insurance policies is a wise move for those who are past the age of 65, no longer need the coverage and own policies with face values more than the $100,000 mark.
Personal Belongings
Some assets are hiding in plain sight. That’s certainly the case with unneeded personal belongings stored in attics, garages, spare bedrooms, basements, tool sheds, and rented units. While all that clutter can appear to be a mess, the bright side is that owners can easily sell many of the items in online auctions and yard sales. Categorize your belongings into four categories: throw away, sell, donate, and keep. Only toss things that can’t be repaired, have zero sentimental value, and no one wants.
Sell anything that has the potential to fetch a reasonable price. Only keep what you truly need and want. Donate the rest. This quick, four-tiered system is an efficient way to sift through everything you own and make fast decisions. It’s also a clever technique for removing household clutter. Don’t forget to keep detailed records of sales and donations. The data will come in handy at tax time.
Spare Bedrooms
Why let an unused bedroom serve as a glorified storage space when it could generate a monthly rental income? Millions of homeowners turn their extra rooms into rented spaces via online platforms. There are several prominent companies with which you can enroll.
Be sure to take high-quality photos of the space, describe it in detail, and make any upgrades required by the listing company. Getting started can take a month or more, but once your room goes on the market, the income potential can be surprisingly good. Always check local laws and HOA guidelines before moving forward as a renter.
Home Equity
If you’ve lived in your home for several years, the built-up equity could be a significant resource in times of need. Large numbers of owners choose to refinance their houses to take advantage of lower interest rates and reduce their monthly payments. The other approach is to borrow against equity at low enough rates to make the move financially attractive.
It is possible to leverage the power of built-up equity to borrow against it and use the funds to purchase a rental property. There are several ways to put home ownership to work. Keep in mind that many borrow against the equity to pay for major vacations, new cars, a child’s education, to start a small business, and dozens of other purposes. Always work with an experienced lender to get the best rates.