The financial aftermath of an accident can be devastating if you’re not prepared. Without a solid plan, you could find yourself drowning in debt, struggling to keep up with expenses while waiting for compensation that might take months or even years to arrive.
While you get help from a personal injury attorney to fast-track the settlement process, there are a few things you can do to keep your finances above the water. Here are some of them.
Get a Lawyer as Soon as Possible
Without legal representation, you could end up settling for far less than you’re entitled to or even missing out on compensation altogether.
A good personal injury lawyer will make sure you’re not paying for expenses that aren’t your responsibility and negotiate to get you the best settlement possible. The best part is that most personal injury attorneys work on a contingency basis, meaning you don’t pay them unless you win.
When you do win, they take a percentage (usually around 30-40%) of your settlement. It might sound like a lot, but without their help, you could walk away with nothing or far less than you actually need.
Consider Taking a Loan
If your accident has left you in a tough financial situation, you might be considering a loan to help cover expenses. This can be a useful short-term solution, but it’s important to be cautious. Not all loans are created equal, and some can trap you in a cycle of debt that’s hard to escape.
Before you apply for a loan, check with your healthcare providers or auto repair shops to see if they offer payment plans. Many hospitals and clinics will allow you to pay your bills over time without interest.
If that’s not an option and you absolutely need a loan, look for one with the lowest possible interest rate. If your credit is good, you can qualify for lower rates, making repayment easier. If your credit isn’t great, be extra careful.
Cut Back on Unnecessary Expenses Immediately
After an accident, your financial priorities need to shift. The first thing you should do is go through your bank statements and look for subscriptions or recurring charges that you don’t absolutely need. Streaming services, gym memberships, and random app subscriptions can add up quickly. Cancelling them can free up cash for expenses that are more important.
File Your Insurance Claim Right Away
If your accident involves an insurance claim, don’t delay. Whether it’s car insurance, health insurance, or home insurance, the sooner you start the claims process, the better. Many insurance policies have strict deadlines for filing claims, and missing them could mean losing out on coverage entirely.
If the insurance company tries to deny your claim or offer you a low settlement, your lawyer can step in and fight for a fair payout.
Be Wary of Scams and Lowball Offers
After an accident, you might feel desperate for financial relief, but don’t let that desperation lead you into a bad decision. Some lenders prey on people in tough situations, offering loans with sky-high interest rates that can leave you worse off in the long run. Read the fine print carefully, and if something sounds too good to be true, it probably is.
Insurance companies might also try to rush you into accepting a settlement. Their goal is to pay as little as possible, and they know that people in financial distress are more likely to accept the first offer. If you do accept this offer, you will find yourself scrambling to cover other costs out of pocket later on.