When you feel as though you’re living paycheck to paycheck, the thought of building up a $1,000 emergency fund can be daunting. But it’s so important, and with a little creativity it can be a fun and rewarding challenge!
However, those dollars will not accumulate without a plan. So as you read, decide which of these idea – or others – you’ll implement to free up cash and make the process of saving go a little faster without your current budget being affected in a way that’s stressful.
Cut back on convenience groceries
Do you have a Keurig? Stop buying those spendy little pre-filled cups and use a refillable one with your own coffee. Instead of individual snack packs, make your own snack mixes in bulk and then portion them out. Figure out what you save on groceries each week and put it in your emergency fund.
Get rid of services you’re paying for and not using
Does gym membership come to mind? A time-share? The newspaper you don’t make time to read? Even small subscriptions can add up. Cancel the ones you don’t use and set up your bank account so that that same amount automatically goes to savings rather than being withdrawn for those memberships.
Purge closets & storage and sell what you no longer need
Whether it’s on ebay, Craigslist, at a garage sale, or on a local Facebook buy/sell group, get rid of those anchors and make some money doing it! They’re not doing any good sitting in your house or garage unused, so you may as well free up some space and put that chunk of change in the bank.
Cancel cable or satellite
Even if it’s just for a season, trim the fat on the channels you get in order to fatten up your emergency fund. Supplement with a digital converter box and movies checked out from the library. If you are a frequent movie renter, add a subscription to Netflix, Amazon Prime, or Hulu Plus so that you save on the cost of both the rentals and the gas to drive there and back twice. After you see how much money you are able to squirrel away from not having a cable bill, you may decide never to go back!
Look into switching to a pre-paid phone plan
While there are some people for whom it’s not practical, changing to a pre-paid plan is often a wise choice that can drastically cut your wireless phone bill. With flat-rate pricing, you won’t have to worry above overages or hidden fees.
Avoid your vices
Does your steering wheel start working on its own when you approach a Starbucks? Can you not leave Michael’s without dropping $50? Then stay away! If you know you lack self-control when it comes to spending in certain stores, simply don’t go. Whatever you’re accustomed to spending in a month on those non-necessities, put that money in savings instead.
Use your skill or talents to earn extra money
Whether it’s a handmade item or a service, leverage your knowledge and experience to make a little extra money providing something that people need. They’re probably going to pay someone to do it or make it, so why not you? Mention your availability via email or on social media so that others are aware.
Take a break from eating out
Try and go just one month without stepping inside a restaurant. Some people may end up with a few hundred dollars in that emergency fund at the end of it! Wouldn’t that be a great motivation to extend it for a few more?
Transfer a certain amount to savings with each paycheck
Determine ahead of time how much this will be, and pretend as though it’s not even available to you. Even if your budget is super tight and you can only manage $20 per bi-weekly paycheck, you’ll have over half your emergency fund saved in a year!
Use your tax return
If you are anticipating a tax return this year, don’t view it as free money and make plans to spend it. Decide that you’ll immediately save $1,000 for your emergency fund (or the full amount of the return if it’s less than that), and then put any excess toward your debt snowball. You will not regret using it this way. I repeat: You will not regret it!
Are there other methods to that have helped you build up your emergency fund?
Please share in the comments!