Life has a way of throwing some unexpected surprises your way when it may not be the most convenient time for you financially. There are ways to prepare for life’s unexpected surprises with a well-funded rainy day fund. These types of situations can be easily stress-free and resolved with the help of a little extra cash that was put back in preparation for these problems.
The first step in strategizing for an emergency fund would be to think critically about any unexpected expenses that may arise in the future. Create a list of foreseeable expenses that are not monthly expenses. For example, home repairs or your children’s braces may be costs that are not frequent but can create unexpected anxiety in your financial plans.
Avoiding the “savings blob” is another opportunity to implement the strong strategy for saving. Do not just keep one big saving account that you may tap into once in awhile. This is the savings blob. Create a various savings account and make them dedicated to specific areas of your financial plan. As well. Certificates of deposits and investment accounts are not ideal for a rainy day fund due to the fact that a short notice withdrawal can result in penalties.
Create positive habits by putting away income into each of your savings funds. Do not be afraid to start small. Even setting up the ability to have your direct deposit channel a percentage of funds to your various savings accounts is a great to not even think about saving for that rainy day.