Lenders and even some financial advisers recommend taking out a home equity loan while you're employed. That way, if you lose your job, you have cash on hand.

I can hear some of you saying, "Desperate times call for desperate measures." But listen to this: Using borrowed money to pay for everyday expenses is adding trouble on top of trouble.

How will you get by, you ask? You will. My grandmother, Big Mama, never made more than $13,000 a year as a nursing assistant. Yet she managed to raise five grandchildren and pay her bills—on time, all the time—without tapping into the equity in her home.

If you're living well now, put aside rainy-day funds. Then, if your situation changes, you won't have to rely on debt.


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