1. Why you Need to Start an Emergency Fund
If you believe that having credit cards to deal with life’s emergencies is perfectly all
right, you need to start changing your mindset. Relying on plastic to tide you over in
case you lose your job is a bad idea. You will be digging your way to even more debt
and what happens if you can’t find work in two, three, four, or five months? The
credit card bills will continue to mount. How will you pay?
This is why it’s important to actually have a cash emergency fund. Dave Ramsey
encourages his readers to start saving $1,000 for use for actual emergencies like
getting fired, having an unexpected pregnancy, and getting very sick. He also says
that you have to start saving up for this fast.
When you have a cash emergency fund, you actually have money to spend for life’s
calamities. These can happen to you any time so it’s always a good idea to be
prepared. Take note that your emergency fund must only be earmarked for those
real problems that life throws at you and not for those emergencies that we make
up.
What are examples of our own made up emergencies? A very common one is a sale
at the mall at 50 percent off. You think you absolutely need to have that piece of
furniture sold at half the price. Problem is, it’s not in your budget. But you have
money stashed in your emergency fund. Stop! A mall sale is not and never will be an
emergency. You cannot use your emergency reserves to get that furniture even if it
is given at 80 percent off and you don’t have money to buy it.
How to Start Putting Together your Rainy Day Fund
Now that it’s clear that your emergency fund must only be used for real
emergencies, it’s time for you to start putting it together. How do you do that and
how do you do so in the quickest possible time? There are actually many ways once
you get revved up with your savings plan.
If your company allows you to render overtime work (and pays for it, of course) then
ask your boss to give you more hours. Work like you’ve never worked before—
without sacrificing family time, of course. Try to look around your house for things
you don’t need and can sell over on eBay. You can also hold a garage sale in your
neighborhood. Remember, one man’s junk is another man’s treasure, so don’t be
ashamed to sell your stuff. If you have time for a part-time job then by all means get

2. one. There are many opportunities to do freelance writing online if that is right up
your alley.
Another source of money can be found in your budget itself. How much are you
earmarking for those restaurant dinners? As you may very well know, eating out is
costly. Start making your own meals and eating at home. Brown bag your lunches
and make your own dinners. This will give you huge savings on your food money—
savings that you can put towards your emergency fund. What about your gasoline
expenses? If you can find a way to carpool then do so. Again, money saved here
can be put in your emergency fund.
At this point, your neighbors and even some relatives and loved ones might think
you’re crazy, but always stay focused on your goal. In a month or less, you should
have your first $1,000 for your emergency fund put up.
When you already have your rainy day fund, you need to find a place to keep it.
Your money should be readily available for you to use when a real emergency
comes up but at the same time it must be inaccessible for those times when you are
just making up your own “emergencies.” You can put this in a savings account that
is not tied to any of your debts or you can keep it in a secret place at home which
only you know how to get to. This takes a little creativity and imagination but the
bottom line is to keep your emergency fund safe until such time that you actually
need it.
Check out www.adamscapgroup.com for more Information on Guide to
Investments.
Other related info you might be interested in:
Getting your Emergency Fund Fully Funded
Saving for Retirement
Understanding Student Loans