Tuesday, September 11, 2012

Money Saving 101: The Emergency Fund



Let’s be honest, who wants a rainy day? Can I be even more honest? Whether you want it or not, it’s going to happen. Sure you can try staying in your house or apartment and avoid every situation that could lead to a ‘financial emergency’ but I guarantee you, eventually your stove will break or your jeans will rip. One way or another, we all will find ourselves in that moment where we need cash and we “need it now” (as the commercials like to say).

So the question becomes, what do you do when there is an emergency? You can sell stuff, borrow money, do odd jobs, but the No.1 thing you could do is to borrow the money from yourself – use your emergency fund!! 

I cannot stress the importance of an emergency fund. Ideally they say you should have at least 6 months of income saved. But for most of us, that seems like a tall order! So, realistically, aim to save around $1,000. This doesn’t happen over night of course, it is slow and steady savings. If you can only put away $10 away a paycheck than do it! (I guarantee you spend that much at least on things like McDonalds stops or Target sales!) That is $10 that is going to be available to you when the rainy day comes. By having that extra money, no matter what amount, you will help reduce stress and fill more in control of your life and your expenses. 

There are so many creative ways to save money, what are some of the ways you save and why?

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