Strategies For Building An Emergency Fund
One of the best things you can do to support your financial health is to create an emergency fund. This fund can be used in case of a medical emergency, a sudden visit to the veterinarian, a home repair, or other unexpected costs that could lead you to take out a small high-interest loan to cover the emergency.
Eventually, it can also be a way to cover your expenses if you lose your job.
These kinds of incidents, both large and small, put people into debt and their finances in a tangle for years.
By building an emergency fund, you develop a financial safety net for yourself.
Many people see the suggestion of saving for six months of expenses and feel that goal is far out of reach; they don’t even want to try. This is a big mistake. If you’re in that situation, first focus on building a small emergency fund of five hundred to fifteen hundred dollars. If this takes you a little time, it’s still worth having. Having a thousand dollars at your back can keep your finances well in hand on a tight budget.
How do people save a sizable emergency fund on any budget?
Open a High Yield Savings Account
Your emergency fund should be accessible, so you don’t want this invested in a 401k or stocks. Put this somewhere it can accrue the most interest and still be at the ready.Read the full article at JBowmanAccountant.org.