Tips For Your Emergency Fund

It is all well and good to be told that you need an emergency fund but where do you get the money to fund this fund? If you are battling with this and really want to start an emergency fund here are a few things you can do

1. Know Your Expenses

Have a very good idea about how much you spend every month. This must include everything from housing, transportation and food to utility and school bills. Once you know your total expenses for each month, multiply that number by three because this is the amount you will be aiming to have as a balance in your fund.

Your goal should be to have an emergency fund that can cover a minimum of 3 months’ worth of expenditures. If you reach a reserve for 6 months then this is even better.

2. Start Simple

Three months’ worth of expenses is a very large amount and it will not be a surprise if your initial reaction is, “I can’t come up with this amount of money.”

You can, with simple things. Think twice before buying fresh food in bulk; be realistic and if you do buy in bulk bag it and freeze it. Every time you put something in the fridge and it goes off is every time you lose money. Reducing food waste is a simple way to save some money.

When you go shopping, leave the trolley and instead, use a basket. Not only will you most probably buy less, you will pay close attention to the items landing in your basket. And, when you get home take the loose change out of your bags and pockets at the end of the day and put it in a jar. If you have children, encourage them to do the same. Make it a family challenge to fill the jar with the loose change and try to beat the time it took the last time to fill it.

And let the jar be a constant reminder of the need for an emergency fund.

3. Be Serious

Treat building an emergency fund seriously. It must appear as a category on your monthly budget rather than you trying to save the money that remains at the end of the month. If you think of the emergency fund as a bill until you reach the target it should not take you very long to reach your target amount.

So treat the emergency fund like any other recurring bill that you must pay each month.

4. Develop Good Habits

To reach your financial goals you need to develop good habits. One is to save first and then spend. Do not first spend your income and then save whatever’s left each month. Make a habit of treating the money put in the emergency fund as a monthly savings as a high-priority.

Also, check the till receipts to see if they are correct and circle the items you spend the most money on. Think about whether you could substitute them for less pricey items or if you could go without.

Decide that you are not going to spend more than X amount on anything unnecessary for the next few months and that you are not going to spend more than X amount on certain items.


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The founder, editor and lead writer who left university with a good grasp of public administration, economics, money, banking and international relations is also qualified in journalism and creative writing. She has been published in Drum and The BBC Focus on Africa Magazine and has been featured in several local and international publications.
An avid bird watcher with an extraordinary fondness for chikanda ( a Zambian delicatessen that vegans and non-vegans world-wide are putting on their bucket list ) she often tweets in poetry and short prose @kwachalelo