10 Random Questions To Ask Yourself About Money – Part 7
Welcome to the latest series on JosephSangl.com – 10 Random Questions To Ask Yourself About Money
These are 10 questions that have personally challenged me in my finances, and I know they can help you too!
Question 7 If I were laid off of work today, how many months could my household operate without severe financial troubles?
It is so easy to spend every dime that we earn. There is a lot of shiny stuff that “speaks” to us and says, “Buy me. Buy me.” However, if there is anything that The Great Recession has taught us it is this – “Down turns happen.” and “Lay-offs happen.”
This is why it is so vitally important to make saving a top priority. A good target for an emergency fund is to have six month’s worth of expenses saved. This can seem impossible, but with an intense focus, it can be accomplished by most people within 6 to 24 months.
ACTION: MAKE SAVING A PRIORITY and make it automatic! I personally have a savings account at Capital One 360 Bank. This on-line savings account pays higher interest than my local “bricks & mortar” bank, and it has a great feature that allows me to set up “automatic savings withdrawals” from my bill pay account. This automation provides the discipline necessary for me, a spender, to save.
Joe,
My wife and I hit the 6 months expense level a little over two years ago. What a peace of mind that brings knowing you have that cushion sitting there in case of an emergency. We have had to use some of the money for expected repairs (there is no such thing as an unexpected repair on a vehicle. it’s mechanical, it WILL break…just a matter of when) but then quickly reloaded. But is was SO nice to have the cash on hand for exactly that purpose.
Keep challenging people to take charge of their finances instead of letting finances dictate their lives.