When inflation is hot, finding extra money for an emergency fund is harder than normal. Luckily, there are some simple ways for people looking to bolster their emergency savings.
Here are 5 tips to start building an emergency fund or save more if you already have one:
#1. Start with a spending plan. Make a spreadsheet so you know what it takes to run your household (monthly). You’ll be surprised to see how much this helps.
#2. Make savings regular and automatic. Create a line item in your budget so you’re contributing every paycheck or month until you reach your goal.
#3. Weekly “fun money” is okay. People tend to overspend on recreational activities, leaving less money for emergencies. To avoid this issue, set aside a certain amount of “fun” money per week.
#4. Watch out for subscriptions. It’s simple – scrutinize your monthly expenses. You don’t need a subscription to every streaming service if you’re trying to save money during times of high inflation.
#5. Lost and found. You never know; you may have an old life insurance policy purchased by a parent that they forgot about. A tax refund could also be used to build up an emergency fund.