Simple Ways to Build an Emergency Fund
Who doesn’t like to save money? We certainly do at Mini Safe Self Storage in San Leandro, CA. This topic is even more relevant for those who have been affected by the government shut down and political standoff that affects hundreds of thousands of families who either work for the federal government or are otherwise affected in a second or third hand relationship with the government employee, such as in a rental agreement, etc.
Clearly, having a backup fund is very important for all families. For those living from paycheck to paycheck, establishing such a fund is even more challenging. There are some easy ways to cut small things out of your budget so that you can set up an emergency fund.
Check your subscriptions
Up to 50 percent of families have a subscription of some kind that they pay for that they just don’t use at all or don’t use to its fullest potential. These are often subscriptions or memberships to health clubs, audio book services, music, make-up, premium television channels, etc. If you need to cut back on them, there are often substitutes that you can use that are lower cost, and often free. Cancelling them, even in the short term, can yield results quickly.
Some services, such as Audible, allow you to pare down your membership, giving you the option to pay for a credit every other month, for example, rather than monthly. While not cutting the cost 100 percent, it is nice to have if you are an avid audio book listener. There are several options for lower-cost audio books, including your local library.
Cut the cord
You’ve probably heard of the trend of cutting the cord. For a fraction of the price of most cable or satellite television packages, you can add an antenna and even a favorite channel to stream. Amazon Prime Video is a very good option for those who are Prime members. Others prefer a subscription to Hulu or Netflix, with their vast repository of television shows available at any time, and with the ability to binge watch.
Round up all purchases
This method takes a bit more planning to be effective. The principle is simple – when you make a purchase, round up and deposit the extra funds in a savings account. If you make a debit card purchase of $3.82, you would move $0.18 into a savings account. Done with every purchase, your savings would build a little bit at a time.
Understandably, doing this on your own could become so cumbersome that many would potentially abandon this method. There are apps that you can use that will take care of this automatically, some for a monthly fee, making this method easier. As this method has become more popular, there are even bank accounts, like Chime, that incorporate automatic savings into their checking accounts.
Consistent savings is the way to go
Building an emergency fund is a slow process. Most people can do so with regular savings. If you find a way that works for you, please pop in and see us at our San Leandro storage facility and let us know.