Staying on track when it comes to your finances can be difficult, especially when you don’t have a large budget but what happens in case of emergency? Maybe you get laid off from work or the roof on your house goes and needs to be replaced. No matter what the emergency is, it’s important to have some funds set aside to use when something unexpected happens.
In order to be prepared during an emergency, you are going to want to make sure you find a way to save some money. The best thing you can do to make saving money more feasible, is start a budget and take a few important steps to cut back on any unnecessary spending.
Budget
Sometimes something as simple as being able to see what you have coming in and going out in terms of your finances can help you to start saving. Create a budget and outline everything that you are required to spend money on each month. This includes utility bills, rent, car payments and extracurriculars. Creating a budget will help you to see where you are overspending, where you can cut back and help you find ways to save.
Cut Back
Find places that you can cut back on spending. Bring your own lunch to work instead of eating out, cancel the unused gym membership or cable and opt to carpool to work to save on gas. These can be some fantastic ways to save money that you can in turn put into your savings for an emergency fund.
Make it Easier
Make putting money aside for an emergency easier and more consistent by setting up automatic transfers directly from your main bank account to your savings. Doing this will help to ensure that you are putting money aside in case something happens, but also makes going into the account to spend it that much harder as you know what it’s for. Once it’s in there it’s more likely to stay and with automatic transfers you don’t have to think about it.
Take it Slow
It may seem like an impossible task to save up an entire month’s worth of expenses in case of emergency, but it doesn’t have to be. Don’t expect to hit your savings goal right away. In fact, start with a reasonable savings goal that you can work towards short term. Start with something small and work your way up.
It is incredibly important to ensure that you are putting money aside in case of emergency. Starting an emergency fund can benefit you greatly down the road if you get into a tough financial situation. Just make sure to start a budget, cut back where you can, make it as easy as possible and take your time.
Elizabeth Lampman is a coffee-fuelled Mom of 2 girls and lives in Hamilton, Ontario. She enjoys travelling, developing easy recipes, crafting, taking on diy projects, travelling and saving money!