These money saving tips will help you set aside cash for those one-time expenses that pop out of nowhere
So, you've worked hard to create a spending plan that gives you peace of mind. In the wake of all your meticulous planning, something unexpected arises. What do you do now? This is just one example of why you should put aside money for emergencies. This amount goes into your rainy day fund.
But how is it different from an emergency fund, and how can you save for a rainy day?
Let’s get into the details and some easy money saving tips to get you started:
What is a Rainy Day Fund?
Surprise expenses can be stressful and burdensome. A rainy day fund is a stash of money you set aside for unexpected, one-time emergencies such as car repairs or a trip to the dentist.
These surprises aren’t always bad. Your friends might announce a reunion in The Bahamas. A rainy day fund will make sure your monthly budget doesn’t receive a blow if unexpected expenses come up. This is why everyone should start saving for a rainy day!
Emergency Fund vs. Rainy Day Fund
You can use rainy savings for emergencies, but this money is different from your typical emergency funds. Emergency funds are more robust and for expenses that cover a few months at least. A rainy day fund, however, is for immediate and smaller emergencies.
For instance, your water heater breaks down. Or you need to replace a broken window quickly to avoid intruders getting into your house. These one-time emergencies call for professional help. Even if they don’t set you back thousands like losing a job would, they still require a small investment. This is where your rainy day fund saves the day.
Now that we know what a rainy day fund is for, here’s how you can set aside cash for those surprise expenses:
Separate savings account for "rainy day" emergencies
Even if you don't have the money to save for a rainy day, setting a goal to build one is a terrific place to start. A rainy day fund will help you decide if you are adequately prepared for the unexpected or if you should continue saving money. You don't have to worry about making a deposit to start an online account.
Find ways to save on unnecessary expenses
You’ll come across several non-necessary expenditures when you're putting your budget together. From canceling a monthly subscription to cutting back oneating out, there are many ways to cut your spending. It all comes down to figuring out your priorities and how you can substitute spending with doing things yourself.
It's never too late for some spring cleaning
Don't hold a garage sale once a year; make it a recurring ritual. You'll be shocked at how quickly you can fill your home with things you don't actually need. Luckily, there are many places you can sell old and unwanted items, including swap meets and Facebook marketplaces.
We have more money saving tips that make your life easier here at Calle Ocho News. Whether you’re looking for tips to save energy or to make a downpayment for a new home, we’ve covered that and more. Follow our news publication to stay updated on the latest news, events, and activities happening in Miami.