Emergency Fund Savings:
We have all heard the saying, we should have an emergency fund, right. “They”, meaning the experts say this fund should be between 3-6 months of expenses. Not an easy task for most and can feel overwhelming for many. According to Nerdwallet 45% of Americans could not come up with $1,000 for an emergency. Most Americans Save, but Many Can’t Cover a $1,000 Emergency – NerdWallet That might be a car repair, so you can get to work, a repair at home that can not wait…. The list goes on. Most people are saving money each month, which is great, and it’s usually in a retirement account and or a savings account. Yet, on average as a group we are falling short with short term “emergency” fund account. We have discussed many times if you really look at your monthly spending and your “habits” there is a good chance you can find an extra $100.00 plus a month to put away in an emergency fund account. Sure, it may take almost a year to get there, at that rate, but the process would be started. If you look at it more as a game and a motivator as to how do I cut out another $20.00 here and there, and transfer that right into savings, thing will happen quicker! The emergency fund is NOT an account that you get to look at the end of the year and say hey I save $1200 and did not need any major or unexpected expense, and then use that money for something like a vacation! Bankrate did a survey on people saving for an emergency or saving for travel. Travel Vs. Savings: Many Americans Are Prioritizing Wanderlust Amid Economic Uncertainty | Bankrate I get it, I want to travel more too, but I also do not want to be under the stress of having to reach for a credit card to pay for a plumber to come to the house for a leak or for new tires! Credit card bills are stressful! Let’s stay out of the rabbit hole. When we have an emergency fund there is a sense of calm and pride to know you do not have to rely on family, a last-minute high interest loan shark loan or the credit card. It’s hard. I get for some that emergency fund of say three months, might be a large number. The real goal is to start and have an emergency fund for emergencies.
Hopefully no real disasters come your way like a job loss while you are working on your savings account. Like every big challenge, you need to start the process with small changes and once you gain confidence from seeing the impact, it will get easier. Like most habits we are trying to change, you may stumble here and there, just get back at it, it’s not a failure. Let’s work toward that first $1,000 in emergency fund savings and use that momentum to do more! This is in reach! How cool would it be to be on the other side of the statistics, of who has a $1,000 or more in an emergency fund! You go this!
two chicks talking money. 