Do you have a personal emergency fund?
Many consumers don’t have one which is unfortunate because when the recent recession hit, many families were seriously stricken by the unexpected turn of events. Many workers have become unemployed and even those who are in high-paying positions have been let go by the companies they work for.
Hence, it is always smart to build a fund for emergencies. Even if you have a small salary, you should still set aside a portion for your personal savings.
In this article, let’s take a look at how you can build an emergency fund even if you live from paycheck to paycheck.
1. Build your motivation.
Being motivated is very important so you can strive to do the tasks you’ve set out to do. But where do you find motivation? If you have a family, then they are definitely the most powerful source of encouragement. You can also set personal goals and use them as you motivation.
2.Create a new budget list.
Jot down all expenses each month, including the smallest cents. Find items on your list that you can eliminate. Try to save even the smallest cents. Remember that even the littlest costs can become big when added up together.
Can you give up your magazine subscriptions or switch to a lower cable plan or internet plan? Can you arrange carpooling with a neighbour or friend? Can you bring packed lunch to work or school? Create a new list and calculate how much you can save by crossing out the less important expenses.
3. Shop around before buying.
Spend time to shop around and compare prices first before making a purchase. IF you plan to apply for a new loan, insurance plan or credit card, evaluate your options carefully.
4. Bring a shopping list.
If you plan to go to the supermarket, create a shopping list so you’ll exactly what you need to buy. Plan you meals for the whole week so you can buy ingredients in bulk, which is cheaper than buying in piece. Calculate your estimated budget for grocery and bring only the exact amount you need.
5. Pay your bills on time.
Submit your utility bill payments and credit card payments promptly to avoid paying the extra costs such as the interest rate and late fees.