Let’s start with the basics. What is an emergency savings fund? It’s a savings account that has enough money to cover six months of living expenses incase the unexpected were to happen. While six months is ideal, saving whatever you can is really the most important. It can be tough to not touch that account, but just remember, if there is an emergency you will be glad you have it.
The first step is opening your account. Select an account with rewards as that will help you build your emergency savings fund. Try Sikorsky Credit Union’s Free Kasasa Saver Account.
Rewards from your Kasasa Checking Account are automatically transferred and it earns dividends. Once your account is established it’s time to start saving!
Set up your savings goals. Even if you can only save a little each month, a little can add up to a lot. Decide how much you would like to save and when you want to have it saved by. Make your savings goals realistic. If it’s realistic you are more likely to stick to it. Although saving can be hard, it’s important to remember, you are paying yourself and investing in your future.
Here are some tips to build your account:
- Set up your paycheck’s direct deposit so a certain percentage goes automatically to your savings account.
- Find areas where you can make cuts to allocate that money to your savings account. Are you paying too much for cable when you can stream? Can you refinance your auto loan to save a little bit each month? Can you cut back on eating out or buying coffee?
- Having a yard sale is a great way to earn some extra cash that won’t be missed if you put it directly into your savings account.
- Try making extra cash on the side by starting a side gig. You can even take out a small percentage of your earnings for your ‘fun fund’ or ‘rainy day account.’
Once you have your emergency savings fund built, you may be wondering what qualifies as an emergency? Here are some examples of financial emergencies:
- Paying bills after a job loss
- Emergency home or car repair
- Unexpected medical bills or deductibles (make sure to check out our Health Savings Account to help with this)
Sikorsky Credit Union is here to help you get started. Open your Free Kasasa Savings Account
One of the most important things the recent pandemic crisis has taught many Americans is the importance of an emergency savings fund. A financial emergency can come out of nowhere and it’s important to be prepared.