Your washing machine. Your car. Your front tooth.
If any of them broke right now, could you repair it right away? Or would you have to walk around with a hole in your smile for months until you could raise the money?
If you can’t afford to fix it today, you are not alone. According to a 2020 Bankrate survey, only 41% of Americans could cover a financial emergency with savings. Even worse? These types of emergencies happen to 28% of people, and the average unexpected expense is about $ 3,500, according to the survey.
This is why having an emergency fund is so important. Don’t know how to get there? Having a budget (that you actually stick to) can help you get there. Here’s a budgeting strategy we recommend and four other tips that can help you keep your expenses in line.
1. The 50/30/20 budgeting rule
The 50/30/20 rule is one of the simplest budgeting methods out there, so you’ve probably heard us talk before if you’re a regular TPH reader. There are no fancy spreadsheets or expensive apps to download (unless you want to), and it’s very simple.
Here’s how it works: 50% of your monthly take-home income goes toward your basic needs: rent, food, minimum debt payments, and other necessities. 30% of your cash goes to fun things and 20% goes to your financial goals. That could be paying more than the minimum on your debts or increasing your investments. And it definitely includes creating your emergency fund!
If you take a look at your budget and find that you don’t have enough left over to contribute to your emergency fund, here are some ways to help balance your budget:
2. Cut almost $ 500 off one of your must-have bills
You are probably overpaying the bills you have to pay each month. But you can reduce those expenses without sacrificing anything. Maybe even enough to cover that window your child just smashed with a ball. Definitely enough to grow your emergency fund by a significant amount.
So when was the last time you checked car insurance prices?
You should buy your options every six months or so as it could save you a lot of money. However, let’s face it. It’s probably not the first thing you think of when you wake up. But it does not have to be like that.
A website called Insure.com makes it easy to compare auto insurance prices. All you have to do is enter your zip code and your age, and it will show you your options.
With Insure.com, people have saved an average of $ 489 a year.
Yes. That could be $ 500 back in your pocket just for taking a few minutes to look at your options.
3. Earn up to $ 225 in extra easy cash
If we told you that you can get free money just for watching videos on your computer, you would probably laugh. It’s too good to be true, right? But we are serious. You can really add a few hundred dollars to your emergency savings with mindless entertainment.
A website called InboxDollars will pay you to watch short video clips online. One minute you can watch someone bake brownies and the next you can get the latest updates on the Kardashian drama.
All you have to do is choose which videos you want to watch and then answer a few quick questions about them. Brands pay InboxDollars to get these videos in front of viewers, and that happens to you.
InboxDollars won’t make you rich, but it is possible to get up to $ 225 per month by watching these videos. It has already paid its users more than $ 56 million.
It takes about a minute to sign up and you will immediately get a $ 5 bonus to get started.
4. Ask this website to pay your credit card bill this month
By just paying the minimum amount on your credit cards, you are extending the life of your debt exponentially, not to mention the hundreds (or thousands) of dollars you are wasting on interest payments. Instead, you could be using that money to boost your emergency savings.
The truth is, your credit card company is happy to allow you to pay only the minimum each month. You are getting rich by ripping you off with high interest rates, some as high as nearly 30%. But a website called AmOne wants to help.
If you owe your credit card companies $ 50,000 or less, AmOne will match you with a low-interest loan that you can use to pay off each of your balances.
The benefit? You will have an invoice to pay each month. And because personal loans have lower interest rates (AmOne rates start at 3.49% APR), you will get out of debt. what Too much faster. Plus: No credit card payment this month.
AmOne keeps your information confidential and secure, which is probably why after 20 years in business, it still has an A + rating with the Better Business Bureau.
It takes two minutes to see if you qualify for up to $ 50,000 online. You must give AmOne a real phone number to qualify, but don’t worry, they won’t spam you with phone calls.
5. Get a side job and earn more money
Let’s face it: if your monthly income is less than your monthly expenses (and you’ve run out of things to cut back), you need more money.
Well, we could all use more money. And by earning a little more each month, we could ensure that we will never be caught off guard when an emergency room visit tries to deplete our savings.
Fortunately, making money has never been easier with the rise of the “Gig Economy”. Here are 31 easy ways to earn money online. What could you do to increase your emergency savings?