Life is never what you expect. Even if you’re cautious and careful with your money, you might still find yourself faced with sudden expenses. Accordingly, Brooks Reitzel Financial Planning Services in High Point, NC, says proper financial planning must include savings for an emergency fund.
3 Financial Planning Tips on Building an Emergency Fund
Consider How Much to Save
First, you should think about how much money you’d like in your emergency fund. Start by setting aside $1,000. This is a good cushion for smaller unexpected expenses, but you should work toward a greater amount for further security. Look at your current income and expenses, and figure out how much you can save each month without affecting your current financial status.
Cut Back on Unnecessary Expenses
Certain behaviors can ruin financial planning. For instance, dining out regularly is a drain on your wallet. Consider packing your own lunch, even a few times a week, while also increasing the amount of time you eat at home in the evenings. In some cases, the cost-savings can amount to hundreds of dollars, which can be placed into your emergency fund.
Look for Additional Sources of Income
If you’re strapped for cash, building an emergency fund can seem daunting. To this end, look for methods of boosting your current income so you can save more. This can be a matter of selling off unwanted or unneeded items, performing small tasks for friends and neighbors, or getting a second job. While it can be time-consuming, remember it’s only necessary until you’ve saved the appropriate amount in your emergency fund.
For help creating your emergency fund, turn to Brooks Reitzel Financial Planning Services. For more than 40 years, the team has assisted High Point residents in preparing for a stable financial future. Learn more about their services by calling (336) 885-7900 or visiting them online today.