The 9 Ways to Build an Emergency Fund When Money’s Tight

Are you among the many Americans who have little money set aside for a real financial emergency? Here are nine steps to fix that and help you sleep better.

In life, nothing is guaranteed. That’s especially true of our finances.

Our jobs — increasingly tied to the global economy — aren’t a sure bet. And major, unexpected expenses can arise at any time.

That means a healthy emergency fund is a must. Here are a few creative ways to build an emergency fund on a shoestring budget:

1. Set a goal

Setting clear and realistic goals is the first step to achieving great things. Use your total monthly net take-home pay to create a reasonable savings goal. Visualize reaching your goal and track your progress along the way.

Start slow, stay steady and watch your stash of cash grow bit by bit. Avoid the temptation to dip into your fund for any reason except legitimate emergencies. You’ll be surprised how having this little self-made insurance policy gives you extra peace of mind.

2. Put the word out

Let friends and family know that you’re working toward a financial goal. This helps develop a community of support.

You don’t have to divulge your deepest financial secrets; just communicate that you hope to save by skipping a few lunches out, lightening your holiday budget or brewing your own morning coffee.

Success is contagious, so don’t be afraid to share how well things are going. You might just inspire others.

3. Spare some change

Although it may sound like a painfully slow and quaint strategy, our parents and grandparents knew the power of saving a dime at a time. Start a new habit of paying for everyday purchases exclusively with cash.

Funnel all the spare change into a jar and let your savings grow the old-fashioned way.

4. Start part time

If you have skills that can be marketed in a freelance capacity, consider launching a part-time business to partially fund your emergency account. Or perhaps an evening or weekend job can give you a quick leg up on savings.

Don’t lose sight of the goal: Pocket what you make, and keep your lifestyle low-key.

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