Why Should I Build an Emergency Fund?

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I know that everyone says you need to have money saved for an emergency, and you should save enough to cover you for at least 3 to 6 months of expenses. But it may be difficult for many of us to save anything at all, mostly because we live paycheck to paycheck. And when we are young, we don’t think about the future and often think that nothing will ever happen.

But what do we do if an emergency arises? What do we do if our car breaks down suddenly or we get sick and can’t work?

Well, I am here to tell you why it’s important to have an emergency fund. In fact, I personally had (have) an unexpected expense and am glad that I have a little bit saved up for an emergency just like this.

My unexpected emergency

Just this past week, I ran into an unexpected expense – my air conditioning went out and has been out for a week! I live in South Texas and the temperature has been unbearable, if you can imagine.

Luckily I have home warranty that covers this but my techs kept cancelling my appointments. So I hired one tech and paid for their services out-of-pocket. However, the AC went out the next day and I hired a different tech and paid again. So up to know, I paid about $200 for two different tech visits. Although $200 may not sound like a lot, that is more or less how much I spend on my weekly grocery bill, so an expense like this may cause many to choose one expense over the other.

Moving on….When I hired the second tech, I was told how to reset my unit but wasn’t assured that I would no longer have problems. And all was well until my unit went out again (this morning actually). I proceeded to reset the unit, it made some weird sounds and was not spinning, and then it died.

The good thing for me is that another tech will be here tomorrow morning to take a look at the unit. I know that this time it will cost me a little bit more to get this problem fixed but the warranty should cover it 🤞🏼.

Be prepared for unexpected emergencies

If you haven’t already done so, take some time to work on your finances and see how prepared you are for an unexpected emergency. If you find it difficult to save money, look at your spending and see what unnecessary expenses you can cut. I’m sure you can do away with your daily Starbucks coffee!

Setting aside money can be difficult for many of us because of rising prices and inflation, and stagnant job wages. And as a result, many families are struggling month to month and living paycheck to paycheck.

However we never really know when and what issues and problems may arise and being unprepared can have a great financial impact on our wallets.

What can I do to be prepared

The simplest way you can start saving money is by using a piggy bank, which is also a great way to start teaching our children the importance of saving. You can use whatever you want as a piggy bank. But try to make sure you’re not going to be tempted to open it – check out this steel piggy bank#ad for adults.

And if you’re working on your budget and cutting expenses but haven’t been able to find a way to start building an emergency fund, you’re not alone.

For a while, I thought I had my finances under control but there was something missing. But when I sat down my financial advisor and showed him my numbers, I received a different perspective. Constructive criticism.

Building an emergency fund is an important part of a strong financial foundation. To learn more and get your finances on track, contact me for a free consultation.