💰Your Guide to Building a Solid Emergency Fund

Oct 30, 2024

We all know life can be unpredictable—car repairs, medical bills, or a sudden job loss can hit when we least expect it. An emergency fund is like a financial safety net, helping you handle those surprises without the stress.

Here’s a quick guide to setting up your own fund with your bank:

1. Set a Goal

Start by aiming for 3 - 6 months of essential expenses. Add up your basics (rent, utilities, groceries) and decide if you need three months’ worth or closer to six.

2. Choose the Right Account

A high-yield savings account (HYSA) is ideal for emergency funds. You’ll earn more interest, which means your fund grows faster. Just make sure it’s FDIC-insured to keep your money safe. Pick the perfect one for you here.

3. Open & Set Up Your Account

Look for a bank with no monthly fees, competitive interest rates, and solid online banking tools.

4. Create a Savings Plan

Set up automatic transfers to your emergency fund each month. Aiming for 5 - 10% of your income is a great start, but even small contributions add up!

5. Track Progress & Adjust as Needed

Check your balance monthly, celebrate milestones, and adjust contributions when your income changes.

6. Know When to Use (and Not Use) Your Fund

True emergencies only! When you need to dip into the fund, try to replenish it ASAP.

7. Reassess Periodically

Big life changes? Annual review? Take a look at your fund to see if adjustments are needed to keep your safety net in top shape.

Why Set Up an Emergency Fund?

Starting today, even with small amounts, will help you build a reliable cushion over time. The peace of mind is worth it. Get started here.

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