Everyone who’s ever had an emergency will tell you money is key to making good decisions. We make bad financial decisions when were broke and desperate. That’s why having an emergency fund is vital to starting any journey in finance. But it’s so hard to save, and then you’ve got the temptation of $1000 sitting in your bank account screaming to be used. Here are some tips we’ve used to save and keep our emergency fund. We currently keep a mini emergency fund of $1000 while we’re paying our debt and so far it’s worked out great. So a note to those on the other end of the spectrum, nervous about draining your savings that low, trust me when I say you’ll be fine, just breathe, commit, and lean in. For the rest of us:
Tired of hearing about budgets yet? It’s like being on a diet and getting reminded over and over that you can’t have dessert. But the budget is the key to achieving your goal. Without a budget your money will get lost in other “important” purchases and you’ll be wondering why you’re 6 months in and no richer than you were to start. Start that budget!
We sold old textbooks, clothes, furniture, even a toaster. Anything that wasn’t vitally essential to our comfort had to go. Craigslist is a familiar place to start but there are plenty of ways to sell stuff without leaving the couch. OfferUp is an app that allows you to put an offer on items in your area, Poshmark is a website that lets you post clothes for sale, and yes, people still use ebay.
Drop the Non Essentials
Cable, your landline, gym membership, any and all subscriptions, you name it. We have money flowing out of our accounts that we never think about. Look through your statement and consider relinquishing one or two things. It doesn’t have to be forever but you may realize you didn’t need it as much as you thought you did.
Commit to not spending for a period of time
If this girl can go without shopping for 2 years then you can go for a month. There are all kinds of things you can fast for a period of time that wouldn’t be sustainable long term but are realistically doable for 1-4 months. Eating out, coffee, alcohol, the bargain bins at Target, these are luxuries you can’t afford if you don’t have money saved for legit emergencies.
Now that you’ve got it:
Keep your emergency fund out of site and out of mind. Open a credit union account that doesn’t charge fees for just letting your money sit in checking. And leave the card at home. I leave mine in the inconvenient file folder with the rest of my financial documents. Then go pretend it doesn’t exist. It’s there if your car dies, you have to make a trip to the ER, your pet eats that leftover chocolate cake you left on the counter (how dare you.) Running out of something isn’t an emergency; paying rent isn’t an emergency. These are things that should be in your budget. Don’t give yourself the temptation to spend your Emergency Fund, you’re not going to be perfect so put parameters on your money to help yourself succeed.