This time last year, CNBC reported on a startling study that stated 62% of Americans didn’t have enough emergency savings to cover even a small unexpected expense. Only 38% of Americans said they could cover something like an emergency room visit or $500 car repair.
Needless to say, the internet blew up with stories of financial doom and gloom – most of which don’t actually help people start saving. Fortunately, we’re more interested in helping you get started saving some money in simple ways. We understand that it can be difficult to start from scratch, so here are some easy ways to build an emergency fund from scratch.
Spring is around the corner, which means it’s time for Spring Cleaning. It’s also a good time to make some money you can put toward savings.
Around March and April of last year I went on a major de-cluttering craze. I cleaned out my closet, got rid of anything I wasn’t actually using, cleared away some books and started refining my collection of gemstones by removing pieces I no longer wanted.
I decided to experiment with selling some of this stuff online and made over $300 that went directly into an emergency fund. It was so successful that I’ve made it a year round habit. The way I see it, if you’re already in the process of clearing out clutter you might as well go the extra mile and make some money with it.
Use services like Digit.co
Digit is a new savings account that came onto the personal finance scene about a year ago. You open a savings account with Digit, connect your checking account and then Digit makes tiny deposits into your bank account. It’s literally only $5 here or $7 there.
The idea is that its a painless way to save money because the withdrawals from your checking account are so small. It’s money you won’t miss and Digit pays attention to what you can and cannot afford to save based on your bills, which eliminates the fear of overdrafting.
It may not seem like much but from December 2015 to now, but I’ve already saved over $400 of what is basically spare change in my Digit account. That’s almost a car repair right there!
One of the best ways to make sure you’re set financially is to have multiple streams of income. Thanks to the internet it’s easier than ever to make some money on the side by trading your skills for some cash.
If you have any sort of skill whatsoever (which we all have) you can make money. Maybe you’re a writer or designer and can sign up for oDesk to make extra money on projects. Maybe you can babysit or start walking dogs in the neighborhood. Any extra money you make can help you build an emergency fund.
Build an Emergency Fund – Final Thoughts
There are multiple options available to help you build an emergency fund from scratch. Withe the right tools and a little extra elbow grease you can build a cushion should you ever be faced with an unexpected expense.
This post was written by Amanda Abella, a business coach for millennials, speaker, and best selling author.