Research has shown that about 64% of Canadians have an emergency fund to handle sudden issues. If you’re in the remaining 36%, you may struggle figuring out how to build an emergency fund. How can you save money to handle these emergencies?
If your personal finances allow you to save emergency money, Kingcash is happy to help. Read on to learn about the best ways to save some emergency cash.
Predict Emergencies
By their nature, emergencies are often unpredictable and sudden. The point of an emergency fund is to be ready in case of an unforeseen circumstance, after all. How can you predict emergencies?
In many cases, you simply can’t. However, there are some circumstances where you can handle an issue before it arises. Here are some different emergencies you may encounter.
Medical
One of the first things many of us expect is a medical emergency. A medical emergency often happens by some sort of freak accident.
Yard work may lead to a tool slipping and a severe wound needing medical attention. A sudden intense illness may lead to you needing medical attention as well. Disregarding the cost of these issues, you also may lose income from an inability to work.
These are rarely predictable, and it’s best to have a fund saved up. That said, you can avoid some of these by investing in proper protective material.
If you’re traveling, do everything you can to avoid illness. Take your vitamins, wear a mask, and sanitize frequently.
For outdoor work, always wear protective gear. Doing so can make a slipped saw ruin your favorite work pants instead of your calf muscle.
Natural
Natural emergencies include things like severe storms or intense weather. In many parts of Canada, you can predict these sorts of issues.
For example, if winter is coming, having an emergency fund to deal with issues from intense snowfall is an easy-to-predict situation. You can calculate how much you need to handle these issues from past experience.
However, some storms may cause more intense problems. Did the winter chill cause your pipes to burst? Has a sudden storm sent a tree through your home’s roof?
For these problems, it’s often best to have insurance. These can help cover the costs of the unforeseen problems. No credit check loans will also help you get the money you need to handle a sudden problem.
Mechanical
Finally, mechanical emergencies are a common occurrence for anyone who regularly commutes. In this category, you can include vehicles, sudden home malfunctions, and similar problems.
A car suddenly breaking down can cost you thousands of dollars. In many cases, it can also stop you from reaching work to earn more and solve the problem.
You can predict these emergencies by paying attention to your vehicle. Has it been years since you last had work done? It may be a good idea to anticipate issues.
Replace worn tires to keep a blowout from happening. Have your oil changed to stop your engine from seizing up. These minor expenses can stop a much more significant expense from adding up.
In minor emergencies, online loans may help you cover the costs. King Cash is happy to help with fast loans in Canada to fix your sudden problems.
Set a Goal
There’s more than just knowing what hassle emergencies pose. You should know how to build an emergency fund for any situation. Here are some of the best ways to grow your emergency money accounts.
Calculate Costs
The first thing you’ll want to do is calculate how much money you’re spending on an average basis. Knowing how much money is flowing out of your account can help you see how much you can save.
The best way to do this is by building a budget. A budget is a form of guideline that will inform you on your spending.
Use your budget to see how much money you’re spending on a regular basis. You can see where your spending is too high, such as on your leisure or food bills. Monthly subscriptions can also add up without you knowing.
Once you’ve calculated your costs, work to cut down on extraneous spending. Doing so will naturally build your savings. By saving money, you can set it into an emergency fund as well.
Monthly and Daily
You shouldn’t think of an emergency fund as a one-and-done situation. You’ll be working to build this fund on a regular basis.
Set up how much you’d like to set into your fund on a monthly basis. Afterward, see how much this means you’ll need to save daily. Some people prefer to work weekly depending on their financial situation.
See how you prefer to save money and keep the funds flowing into your emergency money account. After you’ve built this habit, growing your emergency fund will be second nature.
Prolonged Problems
Not all emergencies require a single fix. While mechanical issues often vanish after the problem is solved, there are often prolonged issues.
A long illness or natural emergency is a good example. These problems will rarely go away overnight and can require extensive funds.
You should have enough in your funds to handle emergencies for months at a time. If you find that your funds are falling short, don’t be afraid to look into online loans to cover short-term expenses. Afterward, make a schedule for how you can quickly and responsibly pay those loans back.
How to Build an Emergency Fund
Understanding how to build an emergency fund is similar to building your savings account. You should work to limit your spending and maximize your income to save some emergency money. If your personal finances are struggling to get off the ground, no credit check loans and online loans may help get rid of some short-term expenses.
For more information on how you can start saving money, be sure to read our extensive blog! You can also contact us to learn more about King Cash.
