Grow an Emergency Fund
If some disaster happens today, tomorrow is too late to start saving.
Maria's words of wisdom
Saving money is hard, especially when finances are already tight. You need an emergency fund. There's no other way to butter that biscuit.
Sometimes what we think are necessities are really the fluffy extras we don't want to live without. I fall into the same trap all the time. I don't need a smart phone or new Photoshop software, but I have them because it makes my life easier--and for now, I can afford them.
The smart phone was an extravagance for sure, but I live in the boonies where my service goes down regularly. That phone has been a lifesaver. And the Photoshop software was unbelievably expensive--hundreds of little doggie dollars. Although it was deductible because I use it in my cover design business, it's still cash out of my pocket.
The trick is to plan your expenses so the surprise expenses don't eat your lunch. There are ways to save without killing yourself.
Here's a quick checklist to get you started.
• First, decide how much you need. The general rule of thumb is 3-6 months worth of living expenses. This is in case you lose your job, or find yourself in a natural disaster (or serious illness) that keeps you from working.
• Start looking at the stuff you can live without. Cut cable, magazines, newspapers, and home phone service. Negotiate for a better cell phone plan, or raise the deductible on your insurance. Stop eating out. Pack lunches for work and school. Quit bad habits. You know what they are.
• Sell something. Consignment stores take almost anything. Selling on Craigslist is even better. And then there's Ebay--and garage sales.
• Scour the house for change. We recently cashed in $50 from a jar of PENNIES. I also have a habit of tucking folding money in every pocket of whatever I'm wearing. Winter is a boon because I always find extra bucks in winter coats.
• Buy nothing new for a month.
• Learn to repair stuff yourself. I've taught myself how to do stuff entirely from YouTube videos. It works!
• Get a side job. Part time jobs and side gigs can be scheduled around your main job.
• Don't shoulder everything alone. Encourage your family to do their part for the cause. After all this is for their benefit too.
• Lastly, and most importantly, never, ever touch your savings unless you're in dire straits. Sometimes when we see a nice nest egg just sitting there it burns a hole in our pockets.
Each and every one of us will suffer real heart-stopping disasters several times in our lives. It's inevitable. That's how life works. But that doesn't mean it should bleed us dry.
Start saving now--this very minute. Even if it's only $10 a week, it's a start in the right direction.
In the meantime, let me blow some fairy dust your way in the hopes that whatever knocks you down will also lift you up.
Do you have an emergency fund? Have you ever needed to use it?