This post is sponsored by COUNTRY Financial®. All opinions are mine.
Sometimes, I feel like I might be the poster child for why an emergency fund is important. Over the last two years, we’ve had two cross country moves, an unexpected job loss, a lot of unexpected expenses, and we recently bought a car. I have seen over and over how important a “cushion” in the bank really is. A few of these things that came up for us wound up costing several thousand dollars that needed to be paid all at once. When Tyler lost his job, we had no idea when we would have that income again (and that was our main income at the time).
Unexpected expenses can be terrifying, but they don’t have to be if you have a plan.
The first big step in setting a savings goal is to calculate roughly what you would need. To comfortably survive a major financial setback (like job loss), you should have at least six months’ worth of your daily expenses saved. I know that it sounds intimidating, but when you think about the big savings goal broken into small weekly goals- it feels way more manageable.
Another tip to achieve the goal faster is to repurpose smaller/unnecessary daily expenses into your savings fund. Skip the coffee, throw that $5 into savings. Even better, try automatically depositing a portion of your weekly/monthly income into your emergency fund, so you can’t spend it to begin with. That one has been GOLD for me, because I don’t even think about it.
Lastly, it’s going to be difficult to properly save if your overall budget isn’t in order. A popular method for budget balancing is the 50-30-20 rule. Fifty percent of your total monthly income for NEEDS, (mortgage, groceries, utilities, etc.) thirty percent should go to your WANTS, (restaurants, travel, etc.) and 20 percent should automatically go toward SAVINGS.
We haven’t always had the goal amount in savings, but when we DID have a comfortable “nest egg”, it made life so much less stressful. Head to COUNTRY Financial to learn more about the ways they can help you achieve financial security. Have you had a time when you wished you had an emergency fund in the bank?