Life is full of unexpected events. No matter how much you try to guard against unwanted surprises, they’re bound to happen at one point or another. Whether it’s your car breaking down, needing repairs to your home, or anything in between, it’s important to be prepared for those “bumps in the road” that sometimes come in life.
While you should have true emergency ideas in mind, like taking out a title loan, you should also have some measures already in place to help protect you. One of the most important things you should do is have an emergency savings fund. This is money that you set aside and don’t touch unless you really need it.
If you’d like to have an emergency fund but don’t know where to start or how you’ll possibly save money, don’t worry. You can make it happen with five simple steps!
Step #1: Save Something from Every Check
The first step toward building an emergency fund is committing to save some money from each paycheck. If you’re not sure how much to save, try setting a savings goal and a specific time you’d like to reach it. Then, see how much it would take you, per paycheck, to reach that goal.
If you don’t have a specific savings goal in mind, you can just commit to saving a certain percentage of each paycheck, ideally at least 10% if you can manage it.
No matter how much you ultimately decide to put in savings, as long as you put something in each and every time you get paid, you’ll find that your emergency fund starts growing more quickly than you imagined.
Step #2: Sell Off Items You Don’t Need
To add an extra boost and really get your emergency fund off the ground, go through your home and gather up items you don’t need or use. Anything from nice clothes to kids toys can earn you money if you take the time to sell it.
You can try having an old-fashioned yard sale, taking your items to a secondhand store that pays cash, or even selling on popular auction sites, such as Ebay. Just make sure you research the value of your items before you sell them. There are many things you may have in your home that are worth a surprising amount of money.
No matter how you sell the items, invest that money into your emergency fund. You might just make a lot more than you bargained for, and even if you don’t, any contribution to your emergency fund is still worthwhile and helpful.
Step #3: Pay Down Your Debt
It might seem a bit counterintuitive to spend money when you’re trying to … Read the rest