Emergency Funds

An emergency fund is a cash that is set aside specifically for unplanned expenses. Emergency funds can be used for any unplanned expense, but the funds are typically used for large expenses such as car repairs, home repairs, or a loss of income.

Most people are unable to afford even a $500 unexpected expense. Emergency funds are important to have so that when unexpected expenses arise, they will not have a lasting impact on your finances.

The amount you should have in an emergency funds varies from person to person. Experts suggest it is best to have 3 to 6 months of expenses saved, but a good goal to start with is to think about the most common unexpected expenses you've had before and how much they cost.

We understand that putting money aside in savings can be difficult, especially for those who live paycheck to paycheck. It is important to understand that setting aside even $5 per paycheck can help provide you with some financial aid in the midst of a financial emergency.

- Set a Goal
The first step to building an emergency fund is to set a goal. Start with a small goal! This will help keep you motivated when you reach it.

- Regularly Contribute
To make sure you stay on track to meet your goals, you should make sure you contribute regularly to your savings account. Set up an automatic transfer of a set amount from your paycheck. Remember, any contribution is better than none. Even if you can only contribute $5 each paycheck, just know you are helping to prepare yourself for times of need.

- Celebrate Success
Find a few low-cost ways to celebrate meeting your goals and recognizing what you have done! Staying consistent with building an emergency fund is challenging and you deserve to give yourself a pat on the back!