Tuesday, September 2, 2014
You can never avoid emergencies in life; however, you can prepare for them. Most emergencies are centered around money so that is why it is so important to have an emergency fund with 9 to 12 months of your salary in it. Some may advise 6 to 9 months but whatever you decide just make sure you build one before you even start investing. A few tips in building an emergency fund:
1) Make a decision to do it and put in the work to make it happen. Maybe you have extra money to build your emergency fund but you have been blowing it on things you dont need so it should be easy for you.. If you make a decision "to give up something you love for something you love more" The more should be financial freedom ..but if you dont have the extra money then that is the next step...start tracking
2) Start tracking what you are spending daily( here is where the work starts). Do this for 30 days and examine areas you are overspending in and find ways to lower those expenses....hint hint:) Most Americans are overspending in areas of communication, taxes, media, and insurance
3) Put your savings on auto pilot and let it come out of your paycheck immediately. I just believe unassigned money is dangerous!! so assign it before you even receive it
4) Stay encouraged throughout the process and Just do it! It may take some time but be patient because the reward is greater than the price you will pay to do it. I promise you will feel so much better when the next emergency arrives!
Well thanks for reading Tiny Tiff Talks!