How to Save for the Unexpected
Preparing for the Unexpected
It's important to have money saved for those surprise expenses in an emergency fund. In fact, most experts suggest having about three to six months' worth of expenses saved. Any expense that you aren’t prepared for is always a challenge. It’s money you didn’t intend to spend or maybe you don’t even have. Maybe this is the year you want to save for the unexpected so that when something unforeseen happens, you’ll be ready!
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There are so many different ways to save for an emergency fund, but a great way is to write the contribution into your monthly budget as if it were another bill or expense. That means that if you want three months' worth of expenses saved, you can reach that in one year by saving one-fourth of your monthly expense amount per month.
By being diligent about setting aside money in an emergency fund, you’re setting yourself up for financial success. When the unexpected comes, your life can continue on as usual because you will be prepared.
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Emergency savings funds can seem a little unnecessary when you could be putting that money toward paying down debt or a down-payment on a house. However, when you find yourself in a financial bind because of an unforeseen expense, you’ll realize just how valuable that emergency savings fund is. By making it a part of your monthly budget, you’re acknowledging how important it is to have money saved for the unpredictable.
For further information about emergency fund finances, access the full article here: https://illinoistreasurer.enrich.org/articles/how-to-save-for-the-unexpected
In life, things pop up that we aren't always prepared for. Creating a budget that prevents you from using debt is all about preparing for the unexpected, and real life. To learn more about preparing for the unexpected, watch this video here.
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