They all say prevention is better than cure –and you should understand why. More often than not, we cannot always predict what life throws our way. It could be a sudden illness, an unexpected travel expense, a poorly calculated girls’ night out or a spike in your monthly electricity bill. Regardless of what unfortunate and unpredicted circumstance might have persisted that have led you to be a stone’s throw away from financial ruin, it is important to take note that whatever financial disaster that is bound to come your way could be very well managed with a good old emergency savings. Here’s how you can start your own emergency fund:
Know how much you need exactly
When saving, the goal is to have enough to cover your expenses from four to seven months. Keep that goal in check. You should calculate just how much you need within those four to seven months; this includes your rent, food and groceries expense and the like. When you are living off you’re your emergency fund, you have to remember that there are certain luxuries that you simply cannot avail of anymore. A shopping spree, even when it is a sale, if it’s not within budget, just will not be financially healthy for you.
Choose a good bank
Part of saving properly is knowing where you can put your money safely and securely. Remember to open up another savings account where you can put your emergency money. This will make it easier for you to save since you have built a distinction between the money you use from everyday expenses and the money you save up for unforeseen emergencies. Make sure that the bank you choose is accessible to you but too accessible that it will be too easy for you to make withdrawals that are unnecessary. It would also help to choose a high interest earning bank.
Make it a habit
Surely, you’ve heard the saying “Pay yourself first.” That should be your mantra when you’re aiming to save up cash. Think of this as an obligation you have to yourself. Once you get your monthly salary, immediately save a chunk for it for your emergency savings account. That way, you really are paying yourself first. Though it may not seem like it at first, but you’ll be patting yourself on the back in the long run.
Saving up for uncalled for emergencies is truly very important. What do you do when we don’t have cash and yet you badly need some? In case you really haven’t saved a few bucks for emergencies but you find yourself in a situation where you need immediate cash, you can always turn to Tree House Loans. They are one of UK’s largest lending companies as they work with UK’s largest lenders.
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