Financial emergencies can crop up unexpectedly and the last thing you want to do is rely on having to apply for another form of debt that might only compound the problem further. It could be the broken down car, job loss, unexpected medical expenses or some other thing you’d never expect. We can tell you from many years of experience helping people through their financial hardships that it is the unexpected that tips people over the edge.
It might be hard to decide how much is appropriate to hold in an emergency fund. Some people have $1000 to cover quick fix problems and others have three to six months of wages saved in case they lose their jobs. The first thing to consider is how much can you afford to put away? Building up the account will require planning and setting a goal. You might have set backs using it for random emergencies, so perhaps even deciding what is an emergency and what you should just be budgeting for in your everyday expenses could be a good start on gaining momentum on the account. e.g. regular car maintenance
It all adds up, even a little bit put away is still a saving
Even if your priority is paying down debt, it is still important to put some money aside for the emergencies. Saving a little each pay day, really does add up.
Perhaps you reach your first goal and then decide to create another account for the three to six months saving account. Wouldn’t that be reassuring?
These things don’t happen overnight. They take discipline. And I don’t mean the old wooden spoon approach. They require you to commit to achieving the goals you set out for yourself and deciding to feel a sense of achievement instead of a quick purchase sensation. Put that money into your saving account. Don’t mistake that advice as a put down. When you have that feeling of achieving those financial goals you’ll come to crave them as much as you’ll crave the quick fix purchase and it will over take you along with a big shift in your financial thinking.
REMEMBER! Things will happen. Set backs will happen in achieving the emergency savings account goals. Not always, but this is life and unless you’re living under a rock then things are bound to upset the savings status quo. Don’t let it stop you. You deserve financial security and every bit you have to put away will count. Maybe you’ll put $50 away a month for 6 months and you have a water pipe burst in the car that costs around that much to fix. Imagine the feeling you’ll have when you have that money and don’t need to stress about juggling finances. If you have any type of emergency wouldn’t it be better to have a least a percentage tuck away to help you through? If you can reclaim $1 a day to put into an account that’s not nothing, it adds up.
If you’re facing financial hardship we are here to talk about a solution. Call us on 1300 887 211 or Book a Free No Obligation Phone Consultation with our friendly team and we can discuss debt management options specially focused on your personal situation.