Five Easy Ways to Raise Last-Minute Cash
Convert Old Stuff to Cash
Cash is king these days.
But don't worry if you're cashless. Turning unwanted stuff into cash is easier than you think. Sources are right at your fingertips, literally. It just takes some hunting.
Take gift cards, which may be lingering in your wallet. They're a ready source of cash, says Bruce Bower, chief executive of Plastic Jungle Inc., a website that buys and sells gift cards. Gift cards totaling $30 million sit unused, according to Deloitte, a consulting and advisory firm. And that amount grows by $8 billion a year.
"Consumers forget about them," Bower says.
But don't stop there. Big banks like KeyBank and Chase Bank, based in Cleveland, are offering cash incentives. Whole life policies and taxable investments can be converted into, well, cash. Even old stuff in drawers and closets can be a gold mine.
Here's the lowdown on how to convert old stuff into cash.
Dig Out Unused Gift Cards
Gift cards are easily turned into cash, with lots of sites springing up to help you. Websites such as Plastic Jungle, GiftCardRescue and Cardpool will buy your gift card from you and then resell it.
Plastic Jungle purchases around 400 different cards. Cards from Walmart are the most coveted, followed by those from Home Depot, Macy's, iTunes and Target. That's because these cards sell for the most money. One plus: Cards issued by big stores usually don't have expiration dates.
The payment process is done electronically. Sellers simply enter the gift card data, such as the merchant and the balance, on a site, and an offer is made. Payments are made via PayPal, paper check or credits on the website Amazon.com.
Don't expect to get full value for your card. Sellers may only reap 90% of the gift card's worth.
Part With Valuable Collectibles
Ready cash from collectibles may be hiding in your closet or basement.
Toys from the 1970s and 1980s, such as Teenage Mutant Ninja Turtles and Transformers action figures, are hot stuff. Pre-1972 Barbie dolls also are highly desirable. Another hot niche is high-end designer clothes such those made by Gucci, says Harry Rinker, an antiques and collectibles expert in Kentwood, Mich.
EBay can be a valuable source of auction information. "You can see what a collectible is worth," Rinker says. "And you can see if it's a viable market."
When selling an item, eBay is often a great choice, Rinker says. Specialized markets, which exist for certain collectibles, are another possibility.
Secondary markets are still another option. For instance, Hummel figurines, Lladro porcelain and Swarovski crystal have secondary markets on resale sites like eBay -- but they aren't strong.
"The secondary market is a tough sell," Rinker says. "If you're making more than 20 cents on the dollar, you're doing well."
Scoop Up Bank Incentives
Big banks are offering juicier incentives than ever.
In 2010, cash rewards for new checking account customers averaged $138, a 16% increase over 2009, according to Mintel Comperemedia, market research firm based in Chicago. Some banks offer as much as $75 for opening a checking account.
"You can get anywhere from $50 to $200 from these promotions," says Ken Tumin, a blogger who writes about deposit accounts. "Most incentives are for checking accounts."
Some savings account incentives are equally rich, or more so if you are willing to deposit a lot of money. Check bank websites for other cash incentives.
Still, many incentive accounts aren't free. "Watch out for monthly fees," Tumin says. And don't be a bonus chaser. "You have to pick bonuses carefully, based on return and reviews of gotchas."
Tap Into Whole Life Insurance
For cash crunches, whole life insurance policies can be converted to their cash values.
You can either surrender your policy to the insurance company for cash. Or, you can use the policy as collateral for a loan from your insurance company, says Glenn Daily, a fee-only insurance consultant in New York.
"It's a good place to borrow from," he says, adding that the interest rates are reasonable.
Don't forget to check out any taxable gains before you surrender the policy.
Cash Out Taxable Investments
Need cash fast? Consider selling assets with the lowest cost of capital.
"If you have equities with losses, sell them and take loss offsets on your taxes," says Michael Dubis, a Certified Financial Planner in Madison, Wis.
The key to selling taxable investments is watching out for capital gains exposure. If you've owned your equities for a long time, you may be hit with high taxes on your capital gains. You could take at least a 20% to 30% shaving, depending on your tax bracket, Dubis says.
Some investments shouldn't be used. It's best to avoid cashing out your IRA or your other retirement assets. They give you protection from creditors, since they can't be touched in bankruptcy court if your finances deteriorate. Additionally, taking a loan against stocks isn't a wise investment move.
"That's a desperation call," Dubis says. "It's a high-interest way to get a loan."