No one is immune to emergency situations. However, having sufficient savings prepared in advance will make the experience that much more bearable. If you don’t already have an emergency fund in place for tough times, you should start building one up as soon as possible. After all, you never know when disaster will strike, and it’s always best to be prepared!
How Can I Start Saving for Emergencies?
Small changes can make a big difference when you decide to start saving for emergencies. Here are a few simple ways you can begin to stash away extra cash for unexpected emergency expenses:
- Be sure to start small and then ramp up. Start with a small savings goal in mind and increase your goal over time. As you meet each savings goal, you will gain confidence, which will make it easier to meet your next goal. If you aim too high from the outset, you may feel discouraged, particularly if you fail to meet your savings goal in a specific period of time.
- If you don’t already have a budget, you need to start one. Understanding your monthly expenses will tell you what you can and cannot cut if you want to save. There are a number of free apps and websites out there that can be used to make creating a budget and planning your savings strategy as simple as can be.
- Most of us spend a fair amount on non-essentials, meaning that there is much that can be cut from our budget with little impact on our day to day lives. For example, if you have a cellphone, then there is no reason for you to have a landline phone as well. Similarly, if you have to head out using your car to do your errands, consider doing them all at the same time to cut down on the number of car trips. Not only will this save you gas money, but it will also save you time.
- See if there are other ways to reduce your costs. For example, call your credit card issuer to see if you can get your interest rate lowered.
- Prioritizing the saving process makes it easier to save. For example, instead of putting whatever remains at the end of the month into your savings, consider putting 10 percent of your paycheck into your savings as soon as you get it. This is particularly effective if you decide to make the process automatic since there is no chance for you to change your mind.