5 Steps to Building a $1000 Emergency Fund
Having a $1000 emergency fund is a smart way to be ready for anything, well financially ready at least. Here is how to get it done.
- First, plan where you are going to keep your money. Do you want to open a savings account at the bank? Do you want to keep cash in the house? Decide on a place that you can put it where you will not be tempted to withdraw from the funds unless you really need it. And keep it somewhere safe.
- Take a look at your current budget to decide how much you can afford to put aside each week. Is it $10 or $50? Be realistic here. You will get to your goal, whether it’s in 90 days or 6 months.
- Now that you know how much, plan out the time frame to get you to $1000. So, if you are saving $20 a week, you will reach your goal in 50 weeks, almost year. It may seem like a long time, but it’s worth it! Don’t be discouraged, because even half way through you will feel like you have accomplished something when you have a $500 emergency fund. So plan it in a way that will encourage you to stick to it. Maybe map it out on a calendar, keep track on your phone, or draw up a chart. You know yourself the best, so go with something that will keep you motivated and keep your eye on the prize!
- Hit your goal!!! Sticking to your plan and hitting your goal is such a great accomplishment! Now you will have the funds to fix your car when suddenly quits on you, or pay for vet bills when your dog eats something he shouldn’t.
- Continue saving. Since you were able to stash away $20 or $50 a paycheck for a while, keep it going! This is a great way to pay off your credit card debt, or add to your savings account. You didn’t miss it before, so keep it up!!