How to save for a rainy day
Having rainy day savings is about saving for any unforeseen occurrences. It can be the first level of your emergency fund. You might eventually need this to overcome a bad situation. Whether you need it or not, having a supply of available funds without the need to rack up debt will give you a sense of control and serenity.
Setting aside for rainy day savings is relatively simple and worth considering. It will help alleviate stress related to financial issues. Here are five simple steps to start saving for a rainy day:
Open a rainy-day savings account
A good starting point is to set the intention of saving. You might not yet be able to fund it, but by opening an account, this will jump onto your to-do list. You will then decide to transfer money into this account and see how much you're managing to save and how much more you intend to keep.
A rainy day savings plan enters your budget
Before saving money for a rainy day, look at your monthly budget and see where you can draw from. It would be best to cut back from an existing budget line to feed this new fund unless you get additional income.
From this point onwards, your rainy day savings are a part of your monthly budget.
Break your main goal into smaller, regular milestones
If you have a clear goal in mind, decide how quickly you'd like to reach this amount.
Let's say you have in mind to build up €1000 in a year. The amount might seem too much. If you approach this into reaching smaller weekly savings, this amounts to just €19.24 a week! Breaking an objective into smaller goals makes it all much more attainable.
Build the habit and consistency of savings
The habit of consistently saving matters more than the amount you can save. The more you get accustomed to it, the easier it gets.
Let's say that you decide to eat in on one Friday a month instead of ordering or going to a restaurant. This will save an average of €30 per month, €360 per year. Put this money into your rainy day savings account, which you can use if unexpected expenses, such as car repairs, pop up.
In good times, ramp up on savings
When times are sound financially, the best is to ramp up even more on savings. Let's say you earn a raise or land a better-paying job. Instead of thinking you can afford to save less, take a further leap and see how much more you can save.
On the same note, if, to the contrary, your working hours are cut back, or your freelance pipeline dries up, do not eliminate rainy day savings just yet. Revisit your whole plan, and if needed, cut down on rainy-day savings to ensure you retain a balanced approach. Remember that there's no right or wrong amount to save. It all depends on what you want to achieve.
You never know what a rainy day might be. Start saving up now and prevent any financial mishaps!
Setting aside for rainy day savings is relatively simple and worth considering. It will help alleviate stress related to financial issues. Here are five simple steps to start saving for a rainy day:
Open a rainy-day savings account
A good starting point is to set the intention of saving. You might not yet be able to fund it, but by opening an account, this will jump onto your to-do list. You will then decide to transfer money into this account and see how much you're managing to save and how much more you intend to keep.
A rainy day savings plan enters your budget
Before saving money for a rainy day, look at your monthly budget and see where you can draw from. It would be best to cut back from an existing budget line to feed this new fund unless you get additional income.
From this point onwards, your rainy day savings are a part of your monthly budget.
Break your main goal into smaller, regular milestones
If you have a clear goal in mind, decide how quickly you'd like to reach this amount.
Let's say you have in mind to build up €1000 in a year. The amount might seem too much. If you approach this into reaching smaller weekly savings, this amounts to just €19.24 a week! Breaking an objective into smaller goals makes it all much more attainable.
Build the habit and consistency of savings
The habit of consistently saving matters more than the amount you can save. The more you get accustomed to it, the easier it gets.
Let's say that you decide to eat in on one Friday a month instead of ordering or going to a restaurant. This will save an average of €30 per month, €360 per year. Put this money into your rainy day savings account, which you can use if unexpected expenses, such as car repairs, pop up.
In good times, ramp up on savings
When times are sound financially, the best is to ramp up even more on savings. Let's say you earn a raise or land a better-paying job. Instead of thinking you can afford to save less, take a further leap and see how much more you can save.
On the same note, if, to the contrary, your working hours are cut back, or your freelance pipeline dries up, do not eliminate rainy day savings just yet. Revisit your whole plan, and if needed, cut down on rainy-day savings to ensure you retain a balanced approach. Remember that there's no right or wrong amount to save. It all depends on what you want to achieve.
You never know what a rainy day might be. Start saving up now and prevent any financial mishaps!