Let’s face it, life happens and well…it’s a part of life. It’s how we deal with the emergency that helps to mold our character. Ok, wait this sounds like some kind of motivational type of post. Anyways, it’s ok to be upset, angry, frustrated and let those feelings out. But those feelings may not be as intense if you’ve planned for it….at least financially.
The best and most effective and common way is to set the emergency fund. Goto your bank, and tell them you want to set up an account for emergencies. Try not to get one that requires a minimum deposit or if you have the money than deposit that minimum amount. Many financial experts say you need anywhere between the range of 3 months to 6 months of living expenses in an emergency fund. So if your living expenses for one month are about $4,000, then you would need $12,000 for 3 months or $24,000 for 6 months…..dang that’s a lot to save, right!
Well, my advice is it depends on what other income you have coming in too. If your significant other or spouse works or someone else that contributes to your household, you may be fine with 3 months. This is because the other household income is still coming in to help pay for bills, groceries, rent, mortgage, etc. If you’re the only one that works and an emergency comes up like an accident, losing your job, some kind of operation, sickness of a loved one, then 6 months of living expenses are my recommendation. The bottom line is you’ll feel more prepared for what life throws at you and remember as the old saying goes…..if you’ve failed to plan that means you’ve planned to fail…..or something like that. ?
How do I start again? go the bank and open an emergency account and start to deposit money, once a month whatever you can afford…..just start and don’t stop!
So how you doing???
How much is in your emergency fund?
How often do you add to it?
When was the last time you took out money from your emergency fund?