How to Set Up an Emergency Fund on a Budget

You can be the most careful, well-meaning person in the world and still have bad luck from time to time. You can be a safe driver and get hit by a car. You could be a hardworking employee, only to get laid off. These things can and will happen to you—so, you might as well save up an emergency fund to prevent it from harming you.

Of course, if you don’t earn much money, this can be a task that’s easier said than done. Thankfully, it’s 2018 and saving money has never been easier. Here are some of the fastest ways to save up cash in a flash.

1. Use apps to automate your savings and investments.

Seriously, start downloading apps and get your money automated. This is the fastest and easiest way to gain control over your personal finances. If you have a tight budget or are low-income, this is the easiest and fastest way to save time and keep things affordable.
Qapital, for example, allows you to set up rules that allow you to save money at a pace that’s affordable for you. And, better yet, it does it for you automatically. Acorns, an investment app, automatically rounds up money and invests it for you in an ETF that works with your needs. Stash, too, works in a similar and automated way.

2. Use apps to get cash back on your regular purchases, and send that straight to your savings.

Apps are also seriously useful when it comes to saving money on groceries and getting cash back for them. Ibotta and Swagbucks, for example, are two apps that give you cash back on the purchases you make every day.
Paper bags of houseplants hang on the handlebars of a bicycle
Photo by Guus Baggermans / Unsplash
By using those apps, you make money money, which can be promptly sent to your emergency savings fund. Little things like this add up immensely.

3. Trim the fat off your budget.

Just about everyone has that one expense that they know is needlessly eating up money, but they just can’t bring themselves to quit. Trimming your expenses is an easy and simple way to free up more money and get enough for a savings account.

4. Aim for an emergency savings of at least six months’ salary.

We’re not going to tell you that it’s going to be easy to save up that much, but we will tell you that it’s well worth it. The more money you have stashed away, the easier it will be to be able to survive trouble—not matter what that trouble may be.

5. Remember that it’s better to pay it in cash than it is to be in debt.

It’s oh, so tempting to just discredit emergency savings as a nonissue until you actually end up in an emergency and need to max out your credit cards to survive. Do the wise thing and save up before you need it. You’ll thank yourself later.

6. Get a side hustle or passive income.

It doesn’t matter what your side hustle is, nor does it matter what forms of passive income you choose. The more money you get, the better off you’ll be when it comes to padding your account.


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