Ask a middle income person if they have had any problems with cash and they will surely say yes. All of us, at some point, had to face this kind of problem - falling short of cash. It can be due to some unforeseen incidents like someone getting into an accident and your insurance does not cover all expenses. It can also be due to poor personal financial management where you spend too much on something, giving in to the temptation of buying that really good Louis Vuitton bag or that really nice Donna Karan dress (well, that really takes a lot of determination to resist these kinds of temptation). It can also be because your company suddenly closed down and you do not have enough savings to support you until you found a new job. This is where all the different kinds of loans enter - whether it is a probate loan, a salary loan, etc.

Though there are times when getting a loan is really inevitable, there are loans that you will not need to have if you only learned how to save and spend money wisely. For some of us, saving about 10% of our income is almost impossible, yet it is possible. The rule is to leave below your means. Set aside the money for savings and live with what is left. In this way, you can have some savings to cover for the rainy days.