Create an Emergency Fund for those Unexpected Situations
Create an emergency fund, being money that you will require during a time of emergency, and when everyone would try to turn their face from you. That’s if you want them to help you come out of the emergency situation with some financial help.
In the present economic situation, face an accident, needs to be hospitalized, needs to buy something urgently, needs to get the car or the air conditioner repaired, and whatnot. Worst of all, you or your spouse, if married, lose you’re your job – that is normally a disaster as far as money is concerned.
An emergency fund is a vital resource that can play a crucial role in our life. One could be called a fool and rebuked if one does not maintain some sort of emergency fund.
Gone are those days when people come forward to help people in an emergency; nowadays, you have to help yourself. Also, a good emergency fund always helps in solving your financial position to some extent.
Emergency funds are normally kept in the house for easy access, but it doesn’t have to be kept there. It is liquid cash that will come in handy when you need it. You don’t have to rush to an ATM, or your next-door neighbor, or friend, or anyone for that matter at odd hours to get some cash.
For this, you have to know (if you have not started with it already) how to create an emergency fund.
- You need to get used to the idea starting from today that you must put aside some money as your emergency fund.
- Once you get your salary, put aside some cash from it; imagine you don’t have that amount with you. For example, if your salary is said $1000, try to keep aside at least $200 from it. If that hurts too much try to save 10% or $100 in this example. Most people can do this if they really try. If your salary is just enough to get by then you will have to sacrifice in some way so you can save 10% of your pay or income.
- For this, you have to curtail a lot from your daily unnecessary expenditures, as you need to counter with a deficit of $200.
- Even from daily expenditures, try to keep aside some money as emergency funds.
- Other than our monthly salary, if you do some part-time work, try keeping that money aside for your emergency fund.
- By doing this you will start to save, or get in the habit of saving. Once you have the habit of saving it becomes easier and easier.
Emergency Fund Example
As an example of easy saving when your salary may even be low follow my example. I save all the change whenever I get change for a dollar or any coins. At one time long ago when I was going to night school I did that and ultimately filled up a five-gallon water jug with my saved coins.
Then I paid some little children a small amount to wrap the coins in a coin wrapper. I did a few myself to show them what to do. All told, I had saved over $1000, mostly in pennies, saved over a period of about two years. That’s not counting what I paid the children from those coins.
That was money I never missed. It was in addition to other money I had saved that was not coins.
One more example of how I create an emergency fund. Although a small one, was a few months ago I did the same thing, but over a shorter period of time. I saved all my coins whenever I got them. A few months later my computer conked out and I decided it would be best to get a new computer. Not wanting to spend a lot of money, yet wanting the latest computer goodies I opted to rebuild my 5-year-old computer.
I Decided to Rebuild my Computer Myself
After checking Amazon, eBay, and Newegg, etc. for current deals, I decided to rebuild my computer myself instead of buying a new one or paying someone else to rebuild it. I counted my coins and had $436.35 I had saved, not counting my pennies of which I had at least 10 – 20 lbs. of copper, which may have been worth more as copper than as pennies.
For a total of about $795, I was able to get the latest six-core AMD processor, a large solid-state hard drive, 8 GB of memory, a new Windows 7, and more. The total cost out of my pocket was less than $400 and the rest came from my coins I had saved.
If you are a person who does not earn a good salary, there is no need to worry. Even from the small salary, you might be earning at present, you can keep some emergency funds aside if you really care for you and your family’s well-being.
Keep a Steady Control of your Daily Expenses
You don’t want to go round begging when an unexpected emergency situation arises. All you have to do is keep a steady control of your daily expenses, or unnecessary expenses that you can do well without. Life won’t stop if you curb these unnecessary expenses.
On the other hand, if you are a person who does not yet earn or does not earn enough money worth mentioning, you must immediately start looking for a permanent job as you know that money does not grow on trees.
Also, don’t ignore the possibility of earning part-time money from online activities. Always keep in mind that you need to create an emergency fund as soon as you are able and that an emergency situation can arise in anyone’s life. One cannot guarantee one’s self of a ‘no-emergency’ situation no matter how much you wish it.
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About the Author
Charles says read about various places you can travel to once the Covid-19 Pandemic is over. He also has and installs websites plus has domains for sale at Domain Sam.