Quick Ways to Create an Emergency Fund

[GoldenEagle]

  6 Quick Ways to Create an Emergency Fund

 

By Tim September 9, 2013

 

I can’t tell you how many times I’ve been thankful that we’ve had an emergency fund. You never know when something expensive will happen, and having a few months of expenses saved up has really alleviated the stress that comes with those unexpected emergencies. The very basic stage of an emergency fund is saving $1,000.  Once you’ve reached that goal, you can start to build up your savings over time – but reaching that first $1,000 is key.

 

I know what you’re saying: “How on earth can I build up $1,000 . . . we don’t even have $50 at the end of each month to spare!” While all of these suggestions won’t work for everyone, there’s a good chance that you can use a couple to boost your savings and reach that $1,000 faster than you think.

 

Ways to Build Your Emergency Savings

1. Use your tax return.

I try to shoot for a $1,000 to $1,500 tax return each year. Yes, I know the money isn’t earning interest, but I’d rather get $1,500 back interest-free than make a mistake and pay $1,500!

 

2. Save your bonus paychecks.

If you’re paid every other week, you’ll receive 26 paychecks each year. That means most months you’ll receive two paychecks, but in two of the 12 months, you get a third paycheck. Plan ahead for the extra check and put that toward your emergency fund. If you make that a goal each time you get that ‘extra’ check, your emergency savings will build faster than you can imagine!

 

3. Save your Christmas bonus.

If you happen to get a Christmas bonus at work, put that money in your emergency fund. Oh, and by the way, make sure you’re saving for Christmas gifts now so that you don’t raid your emergency fund when that time rolls around.

 

4. Stop retirement contributions.

I don’t like telling people to not save for retirement, but if you need to stop for a few months to build your emergency fund, I’d recommend that you consider it. Once you’ve reached your goal, start back up as soon as possible. If you’re not saving for retirement, try to start with something small ($15 or $25 a paycheck) and increase it over time.

 

5. Sell stuff.

We’ve had pretty good luck with making money on eBay. Most of the stuff we’ve sold has been books, but you’d be surprised what people will buy on eBay (like empty iPhone boxes).

 

6. Get a side job.

I know you’re busy, but if you’re serious about building an emergency fund and the other suggestions just aren’t working for you, then try to look for more income. Whether you’re mowing lawns, cleaning windows, or working a weekend at a restaurant, you can make a few extra dollars and set yourself up for those emergencies that seem to come out of nowhere!

 

 

Do you see the value of an emergency fund? What would you suggest to someone who is trying to build up an emergency fund quickly?

 

God bless,

GE

[ncn]

 

 

What would you suggest to someone who is trying to build up an emergency fund quickly?

 

God bless,

GE

 

 

GE, I think I need to set up one. 

 

Please send me your credit card details and your pin numbers 

[kwikphilly]

Wow!ncn.....

    What a great idea,even I can start one that way...how about it GE?(lol)

On a serious note...My bank has a great little savings gimmick....its called "Way to Save"....Its an actual savings account set up to transfer $1.00 everytime you make a purchase with your debit card.....it's a good thing to get in the habit of not carrying cash(as we all know it spends faster)and depending on how much you use your card,you can easily end up with a nice little emergency fund!

                                                                                                                      With love,in Christ-Kwik

[GoldenEagle]

 

 

 

What would you suggest to someone who is trying to build up an emergency fund quickly?

 

God bless,

GE

 

 

GE, I think I need to set up one. 

 

Please send me your credit card details and your pin numbers 

 

 

Lol NCN. The idea is you set up your E-fund with your funds. Not borrowing from others.

Do you have an E-fund?

 

God bless,

GE

[GoldenEagle]

Wow!ncn.....

    What a great idea,even I can start one that way...how about it GE?(lol)

On a serious note...My bank has a great little savings gimmick....its called "Way to Save"....Its an actual savings account set up to transfer $1.00 everytime you make a purchase with your debit card.....it's a good thing to get in the habit of not carrying cash(as we all know it spends faster)and depending on how much you use your card,you can easily end up with a nice little emergency fund!

                                                                                                                      With love,in Christ-Kwik

 

Interesting. Way to Save huh? Nice.

 

I forget which bank in the U.S. has "Keep the Change" where if you spend $19.01 they'll round up to the nearest dollar and give you .99 in your savings. Bank of America?

 

I don't carry cash. It's hard to track cash and it's way to easy to spend cash. Only if we're going to a place that doesn't accept debit/credit cards do I carry cash.

 

God bless,

GE

[ncn]

 

 

 

 

What would you suggest to someone who is trying to build up an emergency fund quickly?

 

God bless,

GE

 

 

GE, I think I need to set up one. 

 

Please send me your credit card details and your pin numbers 

 

 

Lol NCN. The idea is you set up your E-fund with your funds. Not borrowing from others.

Do you have an E-fund?

 

God bless,

GE

 

 

Now why did I think you would say that. 

 

So, I don't really have an emergency fund as such.

I did open a savings account. 

What I do is this, as in the UK we still purchase things using cash for smaller items, when I get home I throw all my loose change into a jar.

We call this your , "shrapnel" . 

 

Once a month I empty it and go to the bank, throw it into the change counter and then deposit it.

Surprisingly on an average I can save about £45/70 a month this way and I don't really notice that it's not there.

Once the shrapnel is in the jar, it stays there and is not touched. 

 

I used this extra cash when I went away this summer and it came in handy. 

 

I don't really call it an emergency fund as I pay all my bills by direct debit and don't use credit in any form. 

My rule is , if I cannot pay for it, I don't purchase it.

( I think this is a good system and you don't have to fear the postman dropping unwanted bills through the letter box.) 

 

PS.

I also cannot take it with me when I go home 

(I will be given a military funeral so that is all taken care of, so an emergency fund for me is not that important. I am truly blessed.) 

[Guest AFlameOfFire]

I have done what GE has shared on that rounding up, in two years (on my side of things) verses the hubbies I was able to save over $2000. Like if something was $17.50 at the store I would round up to $20.00 because I stink at math but in doing that I have never bounced checks.

 

Another thing I do (off to the sly) is when the phone bill comes in, lets say its $53.00 I might pay $70 (depends). But I just over pay it. After doing that for a couple of years I always have a credit with them (and receive each forthcoming bill with owing zero) but shows them deducting from what I have a credit toward. And I just even that out now (adding no more to it) having that 6 months ahead. So just say I cant make one months payment, it just deducts what I have previously saved up in credit toward it.

 

And once one has been established ahead (for just say, an emergency fund, where the bills are paid) incase my husband gets injured at work and cant work, we have planned toward such a time and gives us so much borrowed time without being a burden on our families.

 

Then with that out of the way, start the next one very slowly.

 

We don't have credit cards, so we need to save for everything. I mean we have one with Home depot we keep at a zero balance. But when we ever use that we already have it in the account for whatever it is we will use it for. And so in that way do we keep our credit current (just in case its needed) and in good standing (but also avoiding interest rates/charges). So we sort of siphon the need through it and then payment to it (that month).

 

But even we didn't have enough to cover our last emergency (the roof) we would have needed 17 of GE's emergency funds LOL and then another 10 of them for the truck saving fund (we robbed) to pay for the roof.

 

If emergencies were only $1000 (half the time) that would be just wonderful. Because this year has been the worst of years for us.

 

We had lived in credit card debt in the past, and changed that habit, which frees you up so much in dropping that. Same with our vehicles, we drive them into the ground, all of our vehicles are nearly 15 years old. One has a rebuilt engine, the other needs one (soon). But I don't care, it sure beats carrying payments towards them (especially at one time). If we carried all three vehicles (brand new) they would cost us $1900 a month (combined). One because his Fed Ex ground truck was over $1200 (a month) to carry (until it would be paid off in 5 years) the corolla (was $300 a month) and His Ford Ranger ($400) and we were broke just trying to meet all of those. But in being loosed from them, a lot does go into repairs, but absolutely no-wheres near what it costed to carry all three of them monthly.

 

And so you can see how being freed of these (payments, which is inclusive of the interests on these loans) allows you to save up (interest free) toward the fullest payment of your next vehicle (even while you are still riding the others into the ground). Well, at least until you can replace it without carrying that payment (plus interest) load (on each combined)

 

But you gotta be disciplined in the sense that you don't allow yourself to say, hey wow, look at all this extra money and start living the high life because its only going to turn around and bite you in the rear (in a matter of time) because these things rust (and wont last forever on you) so if you constantly take what you what you would typically put toward one (excluding the interest you wont be paying) into savings even as we would to the Lords purposes it will work itself out in the end.

 

All things are relevant though, I recalled when my husband got that job and I was like WHAT??? $1200 a month for that truck?! And nearly $300 now (these days) to fill it weekly! I was like Yeah RIGHT! You gotta be kidding me? So what seemed like a much bigger paycheck (at the first) was quickly diminished by the costs involved in actually keeping that truck on the road and if we messed that up (mishandling things) it can become quite a burden.

 

Though I must say its worth it in reducing your debt and preparing (even if little by little) because we lived week by week for something like seven years. Sheets as curtains, and not sure that empty tank of gas would even get me to my last job (let alone to the bank) just to cash the check received so I could fill up the car (just to get home) and have $30 for two (left) for food shopping that week. I recall those days so clearly. But God did wonders in those days, everything was a miracle to me then. I think you can even see that more clearly when you are poorer too. and I don't despise those days either for any of that, I am grateful for them. But I definitely don't want to chained down to the machine (so to speak) especially because of my own doings (and mishandling of things). If I can (at all) help it. That's not fun.

Edited September 19, 2013 by AFlameOfFire

[GoldenEagle]

I have done what GE has shared on that rounding up, in two years (on my side of things) verses the hubbies I was able to save over $2000. Like if something was $17.50 at the store I would round up to $20.00 because I stink at math but in doing that I have never bounced checks.

 

Another thing I do (off to the sly) is when the phone bill comes in, lets say its $53.00 I might pay $70 (depends). But I just over pay it. After doing that for a couple of years I always have a credit with them (and receive each forthcoming bill with owing zero) but shows them deducting from what I have a credit toward. And I just even that out now (adding no more to it) having that 6 months ahead. So just say I cant make one months payment, it just deducts what I have previously saved up in credit toward it.

 

And once one has been established ahead (for just say, an emergency fund, where the bills are paid) incase my husband gets injured at work and cant work, we have planned toward such a time and gives us so much borrowed time without being a burden on our families.

 

Then with that out of the way, start the next one very slowly.

 

Very nice Flame! So you use the Bank of America “Keep the Change” program Flame? $2000 on that program? Wow!

Yes, paying bills early is a good thing. That is a wonderful idea. The only thing is you’re basically giving the companies extra money interest free correct? However, I can see where if you are say 6 months ahead on a bill that would be peace of mind if either of you were to lose or get hurt at your jobs.

[GoldenEagle]

We don't have credit cards, so we need to save for everything. I mean we have one with Home depot we keep at a zero balance. But when we ever use that we already have it in the account for whatever it is we will use it for. And so in that way do we keep our credit current (just in case its needed) and in good standing (but also avoiding interest rates/charges). So we sort of siphon the need through it and then payment to it (that month).

 

But even we didn't have enough to cover our last emergency (the roof) we would have needed 17 of GE's emergency funds LOL and then another 10 of them for the truck saving fund (we robbed) to pay for the roof.

 

If emergencies were only $1000 (half the time) that would be just wonderful. Because this year has been the worst of years for us.

 

We had lived in credit card debt in the past, and changed that habit, which frees you up so much in dropping that. Same with our vehicles, we drive them into the ground, all of our vehicles are nearly 15 years old. One has a rebuilt engine, the other needs one (soon). But I don't care, it sure beats carrying payments towards them (especially at one time). If we carried all three vehicles (brand new) they would cost us $1900 a month (combined). One because his Fed Ex ground truck was over $1200 (a month) to carry (until it would be paid off in 5 years) the corolla (was $300 a month) and His Ford Ranger ($400) and we were broke just trying to meet all of those. But in being loosed from them, a lot does go into repairs, but absolutely no-wheres near what it costed to carry all three of them monthly.

 

And so you can see how being freed of these (payments, which is inclusive of the interests on these loans) allows you to save up (interest free) toward the fullest payment of your next vehicle (even while you are still riding the others into the ground). Well, at least until you can replace it without carrying that payment (plus interest) load (on each combined)

 

I can see where not having credit cards can be a blessing. We use ours like debit cards and pay them off each month as if they’re debit cards. With a cash back rewards program (1-5%) we have an additional $500 in rewards in the last year or so. Something worthwhile to look into.

Really the $1000 is a starting point. I would personally recommend having 3-12 months income worth of savings in case of the loss of job, disability, etc. But to get to such an amount we got to start somewhere with a few baby steps. $1000 is that first baby step IMO

 

As far as vehicles go the best thing I’ve found is to try to pay cash for a cheap vehicle say $1,000 to $2,000. Then pay yourself in your savings a monthly car payment of say $300-400 a month. Once that initial car is run into the ground say 12-16 months later buy a car with the money you saved up.

Both our van and our economy car (Civic) are paid off this way. We never want to have a car payment again. Rather pay ourselves than the bank interest

God bless,

GE

[GoldenEagle]

But you gotta be disciplined in the sense that you don't allow yourself to say, hey wow, look at all this extra money and start living the high life because its only going to turn around and bite you in the rear (in a matter of time) because these things rust (and wont last forever on you) so if you constantly take what you what you would typically put toward one (excluding the interest you wont be paying) into savings even as we would to the Lords purposes it will work itself out in the end.

 

All things are relevant though, I recalled when my husband got that job and I was like WHAT??? $1200 a month for that truck?! And nearly $300 now (these days) to fill it weekly! I was like Yeah RIGHT! You gotta be kidding me? So what seemed like a much bigger paycheck (at the first) was quickly diminished by the costs involved in actually keeping that truck on the road and if we messed that up (mishandling things) it can become quite a burden.

 

Though I must say its worth it in reducing your debt and preparing (even if little by little) because we lived week by week for something like seven years. Sheets as curtains, and not sure that empty tank of gas would even get me to my last job (let alone to the bank) just to cash the check received so I could fill up the car (just to get home) and have $30 for two (left) for food shopping that week. I recall those days so clearly. But God did wonders in those days, everything was a miracle to me then. I think you can even see that more clearly when you are poorer too. and I don't despise those days either for any of that, I am grateful for them. But I definitely don't want to chained down to the machine (so to speak) especially because of my own doings (and mishandling of things). If I can (at all) help it. That's not fun.

 

I do agree discipline is key. I agree too that giving to the work of the Lord is a good investment. There are two things that are eternal value this side of Heaven – people and God’s Word. Keeping an eternal perspective is good.

Besides an E-fund I think having a budget where both spouses agree on where the money is going for the month is also helpful.

God bless,

GE