Hi my name is Jenny and I am pretty much a shopaholic. That statement is only partially true, but I do really love to take advantage of a good sale and that used to really leave me in a bit of a pinch whenever an unexpected expense came about. With that in mind, today I am going to be giving you some reasons on why you absolutely need to have an emergency fund. While I am no financial expert, I have grown my emergency fund in just a matter of months by contributing $200 from each paycheck to my emergency fund and now I feel like if I am ever in an situation and need to quickly shell out some cash, I am prepared to do so. Life tends to throw lots of curve balls, so you have to be prepared.
Why You Need an Emergency Fund
- In case you have a true emergency and need some extra money // I am in the beginning steps of reestablishing my emergency fund but you bet that I have enough saved up in the instance that I have a blowout, I can shell out the cash to afford a new tire without having to charge it on my credit card or any other random expense that I may not be expecting. This also goes for any unexpected medical expenses that may arise.
- In the off chance that you lose your job // This actually happened to me last May and I was so thankful to have enough saved up to get by until I found a new job. Now I won’t say that I could have completely supported myself if I lived alone and had to pay full on rent each month, but I had enough saved up that I wasn’t completely out of commission.
- To pay off student loans // The whole reason why I started my emergency fund is so that I am putting that money aside to pay off my student loans once I complete graduate school. I am going to start paying it off little by little very soon just to get a jump start on the payments but this is the initial reason I started my emergency fund. Of course the money going into this fund is also made for any unexpected expenses as I mentioned above, but the primary reason for my fund was to save to pay off my loans.
- To keep you from spending all of your money // I know quite a few people who burn through all of their money on frivolous things before even getting their next paycheck even and only contribute a tiny amount to their savings each month, don’t be that person. If you have to, set up your emergency fund at a different bank so that it isn’t as easy to log in and transfer your money from your savings to your checking account.
Do you have an emergency fund? I’d love to know your thoughts on the matter. Let me know down in the comments.
Become a Breakfast at Lilly's Insider
Sign up today and receive your FREE daily blogging checklist!