Emergencies can strike at any time. Would you have the funds necessary to cover that emergency? Saving for emergencies doesn’t have to be a daunting task with these four tips:
Set Up An Emergency Fund
It’s a good idea to open a savings account especially for storing your emergency fund. That way, you won’t be tempted to dip into it. 1st Advantage Bank offers several savings options for your needs and we will work with you to find the best solution.
Think About Your Savings Goal
The recommended emergency fund is 3 to 6 months’ worth of living expenses and unfortunately, many people give up before they reach that goal. Think about how much you want to save and make a plan on how you can reach it.
Automatically Put Some Money Back Every Paycheck
A little bit goes a long way. Instead of putting a large chunk of change into your emergency savings, break it down into smaller payments over time. This is easily accomplished by setting up automatic transfers each paycheck.
Avoid Over-Saving
While it’s good to save your money, avoid over-saving. Emergency funds should be accessed quickly and will most likely be deposited into a low-yield savings account. As such, you should balance emergency fund deposits with other financial commitments like paying off debts. That way, you don’t neglect other necessary expenses.