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Got Funds?

Got Funds?

Most people have a hard time justifying funneling 3-6 months worth of expenses into a savings account. They ask themselves, time and time again, why do I need this? The answer, of course, is "What if?"

What if you lose your job? What if something happens to you or your spouse? What if the refrigerator blows out, or you need a root canal? There are so many what-ifs in life that it's always better to be prepared. Sure, insurance is available for a lot of the what-ifs, but most insurance policies have restrictions on how they can and can't be used. When they'll pay out and how much are also a factor to keep in mind. Plus, there's simply no insurance for losing your job. You may be able to claim unemployment under certain circumstances, but it's nowhere near enough for you to live at your current lifestyle level (which we're assuming is why you haven't been saving in the first place!)

We're not here to judge, and we didn't get started on saving until later in life either! But getting started now is better than never doing it at all. Instead of putting your emergencies on a high interest credit card, start socking away a little money every
month, just in case. If you don't have an income, it's pretty hard to pay back those credit cards and once you've run them up, then what do you do? An emergency fund is a security net, especially for people who live paycheck to paycheck!

Do you have an emergency fund? If not, what's really keeping you from starting one? [Kiplingers]

Posted: 5/29/08
kristen

It's so encouraging to see all of you taking this on! I know it's tough when you're stretching every last dollar, but we can do it!

I love the advice of paying for things with cash and then stashing away the change. Just one little thing like that can add up to big savings!

  • By kristen
  • on 6/5/08 11:20 AM EST
martyso

One piece of advice that I received that has helped me enormously is to "Pay Yourself First". That means before anything else happens, put 10% of your paycheck into an account, piggybank, old sock ,etc. Trust me that it really helped me because I never had any extra at the end but if I put it away first, I alway had it.

oldgold

I live week to week and some weeks there is no pay. If I'm struggling to pay the rent how can I save anything???
I don't know, but I'll give it a try, but ONLY because of your encouragement. When I was young, peer group pressure got me into all sorts of trouble. Maybe now it will get me into some good. I'll let you know how it works out.

  • By oldgold
  • on 6/1/08 12:50 PM EST
MsTee610

How to start an emergency fund? What I do is always use bills ($5,$10,$20) when I purchase things. Then the one dollar bills and all the change I put in a money jar and then when I come up short I always have that to rely on. You would not believe how fast that all adds up. I have been doing this for a long time now. It really does help especially when you are a single parent. Hope this idea helps someone.

j4metoo

How can you get a fund going? 1. Set aside money from your paycheck-every paycheck and put it away in a savings account. Even if it's only $25, that adds up.
2. Apply for a home equity loan, right now you can get excellents rates on these loans, and you don't pay anything if you don't use the cash. So it's great to have the funds in case of emergency. 3. Ask your employer to put cash aside for you, before you ever get paid. This is great if it's time for a raise. Why not have the raise put straight into a savings account?

  • By j4metoo
  • on 5/30/08 3:29 PM EST
enveno1

i am a new only parent of a teenage son..after a nasty divorce ..i found myself tring to make ends meet and still buy what my son needs to live...the only job i have been able to get has been at the local fast food place ..in a small town everyone knows everyones buisness..you sneeze and 15 people are handing you napkins ..it is hard for me to put away money..but you do make a valad point..i see the need ..if i can just find the funds...thanks

  • By enveno1
  • on 5/30/08 10:28 AM EST