I was reading some of the posts on emergency funds from the Money Hacks Carnival. Silicone Valley Blogger at The Digerati Life had an article on 5 Different Ways To Build An Emergency Fund. It’s actually a look at different methods of having an emergency fund. In the past, I was definitely number 1 and that’s not a good thing. I have changed my ways recently.
I am still struggling to build my emergency fund and it’s hard when there isn’t enough money to pay the bills. I know you are thinking why would I put money into savings if there isn’t enough in the first place? Unfortunately not having money to pay for emergencies doesn’t keep them from happening and having NO money makes everything an emergency.
I may not build my emergency fund as quickly as some but I still need to have one. What would happen if my car broke down and I couldn’t go to work? It’s an older car and while it’s been pretty dependable, it does have over 200,000 miles on it. So yes, I am trying to tuck a couple dollars a day into my savings account.
Frankly, I can’t pay the full amount on my bills whether I save a few bucks or not so I might as well put a little into the emergency fund so that if something happens, I can continue to pay something on them. I have been trying to snowflake the money but I have cut my expenses to the bare bones anyway so that is difficult.
I own a pet grooming business and yesterday I decided that the easiest way to save would be to put $1 a dog into my savings account. This will accomplish two things. It will barely be missed as like a snowflake, it a small amount on a daily basis. It will also enable me to pay for any emergencies that happen at the shop. It still won’t be a huge amount. I figure last month I would have saved $65 but it will grow over time.
I miss the days when I had a job with a company that matched my 401K up to 6% of my salary. It wasn’t an emergency fund but it did get used as one over the last year. If you work for a company who matches your funds, you are missing a great opportunity to save. Look at it like this, you immediately make 100% on the matching funds. There is no better way to save than that.
Have you managed to put money into your emergency fund on a regular basis? What ways have you found to squeeze money out of your budget for it?
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It’s funny we both blogged about emergency funds today
I’ve done the scrimp and save routine, and I do assure you it gets easier once you can knock out a couple of the debts! Keep going, it really is worth it. And I believe in you.
You’re not “saving for retirement” if you put money into a retirement account (401K) only to later on pull it out and spend it! If you can’t afford to buy something without digging into your retirement savings, then you can’t really afford it.
Overall, your planning seems to need a bit of work. How come three days ago you were intending to find a job (and therefore expected your business to suffer), yet today you’re basing your savings “plan” on socking away $1 per dog?
LOL. Without knowing anything about this carnival, I also posted on Emergency Funds just yesterday (which was Thursday here in Australia). We had to draw on ours recently and I was REALLY glad it was there to draw on. It’s the first time since having one that we needed to draw on it.
@DebtFree, Thanks for the encouragement.
@ Enough Wealth, I agree with you wholeheartedly about the retirement account. Unfortunately, I was caught in a position where it was take the money out or lose two houses to foreclosure and there was that minor matter of eating.
Despite my intention of finding a job, until I do the business is all I have and I really don’t think $180 is enough of an emergency fund. When and if I find a job, I hope that a good portion of my debt and savings issues will be resolved.
Poor planning? Yes, I expect that is a fair judgment although I hope that I have changed that considerably over the last months.
I found your blog recently and really enjoy it. Your financial situation is akin to mine… as in, you don’t have money to blow, either!
I can relate to the issue of it taking a long time to build the emergency fund. It’s taking us months to get ours. We lost our house in foreclosure, we’ve sold all we can, we don’t have car payments, and we’re still struggling. We don’t blow a lot of money – we simply don’t make quite enough. I think you know what I mean!
Anyway, thanks for your great blog and know you aren’t alone.
Denise, as much as misery loves company, I wish I were a lot more alone. I try to remember that while we can’t change the past, the future is ours to mold however we choose. The past year has taught me a lesson that I wish I had learned years ago but I have learned it now and things will get better.