You Need an Emergency Fund


You'll usually hear you need $1000 for an emergency fund and that's what I recommend. Unless you're not paying rent, utilities, insurance, or a number of other things, $1000 is not going to get you very far if you lose your job. Maybe that's what you're thinking an emergency fund is for. It is, but it's also for if your water heater breaks, your car breaks down, or if you have to pay a deductible for an insurance claim.
If you budget, you may have categories for those maintenance things. We've recently gotten better at budgeting for home and car maintenance, but sometimes things hit you back to back and that budget category could be to 0 and you still need more. That's when this $1000 comes in handy. If your expenses are already tight every month, having $1000 tucked away may be the only thing you can handle. That's okay. When the time comes where you need to fix/replace/pay for something and you have to use this emergency fund, you'll be glad you took the time and effort to save the money. Once you use any of that $1000, it should be top priority to get it back to that amount.
Maybe you've only ever heard that you need 4-6 months living expenses in your bank account. I'd say this is true, too. I don't know about you, but saving up that much money is a daunting task. Sometimes it seems like we'll never get there. We're almost to 1 month. We don't try very hard to get there, but it's still a goal. If it's your only goal, you may get discouraged and give up. Having the goal of a $1000 emergency fund allows you to have a goal you can reach quickly. You'll feel good about the fact you did it and it'll encourage you to continue saving.
Here are some ways you can make some extra cash to get to that $1000 goal:
1. Sell your stuff on Craigslist
2. Sell your plasma
3. Micro-task websites like mturk or clickworker. It's slow money, but you can do it while you watch netflix.
4. Be an Uber driver
5. Tutor
6. Sell your services on
7. Get a part time job - this is great and temporary if it's during a holiday season where a lot of companies need extra help.
8. Take online surveys.
9. Trade in your clothes at Plato's Closet or online at Thread Up
10. One time jobs on Craiglist help wanted ads.
If you want more ideas check out Reddit in the WorkOnline and BeerMoney subreddits.

You may also like

No comments:

Powered by Blogger.