Emergencies are unexpected and can really hinder on your financial situation if you’re not prepared.
For instance, just this year, our dog Valeria went ill. The veterinarian couldn’t figure out what was wrong with her with simply just x-rays. She needed surgery to see what was making her so sick. We just wanted her fixed.
The vet bill was a bit over 1000$ but we had already over that amount in our emergency fund. We had no stress paying this expense, just stress of getting our little one healthy.
No one wants to be in those situations and it doesn’t mean you will be but if you do end up there then you’ll be prepared!
How Much Money Should Go Into Your Emergency Fund
There is no set amount to have for your emergency fund. Your first goal to reach I suggest is $1000.
After that, aim to reach 3-6 months of salary. This amount will be SO beneficial if you get laid off from work or even get seriously sick or hurt.
Where To Put Your Emergency Fund
You can do this three ways:
Bank Account. You can open a savings bank account and give it a nickname of Emergency Fund.
Cash. It’s always good to have cash on hand, you can place it in an envelope marked Emergency Fund and hide it.
Bank Account & Cash. Why not have both, just in case.
How To Build Your Emergency Fund Fast
1. Put it in your budget
It’s easy to have a plan when you create a budget, an outline of where your money will go. Figure out how you can wiggle this expense in your budget.
If there’s not a lot going towards your Emergency Fund, cut back on some of your entertainment money (I take out 20$ a week but before my emergency fund was where I wanted it to be, I took out 20$ every two weeks until it was built).
2. Sell your stuff
You’ll be surprised at how much stuff you don’t use that other people would buy.
We’re actually doing another round of selling stuff we don’t use anymore. We figure if it’s been 3+ years and we haven’t touched the item, then we don’t need it.
You can sell your stuff through eBay or even keep it in your Facebook friends circle to start. Take a photo of your items and list them and price them.
Another option would be to do a garage sale.
3. Get an extra job
Having a side hustle is natural these days. You can start a blog as I did, you can read all about how to start one here: How To Start A Blog For Beginners. Or do local jobs like raking leaves, babysitting, cleaning houses. A good place to look for local jobs would be Facebook Groups, just search for your town groups. You’ll surely find a group that supports local businesses.
4. Change your spending habits
Lastly, A great fast and great way to find extra cash to add to your emergency fund are to change your spending habits. If you haven’t read about some of the common spending habits I’ve changed myself, head on over here: Save Money by Changing Your Spending Habits and get some ideas!
In conclusion, be prepared for the unexpected. This will take a lot of stress off your shoulders knowing you have the funds to deal with an emergency situation.
Let me know in the comments how you’re building your emergency fund!