Devoloping Your Rainy Day Fund: A Path to Economic Security

Rebecca Matthes, Guest Blogger

How long could you survive financially if you lost your job?  Faced unexpected medical bills?  Needed to make reservations for a last-minute flight to attend a funeral?  These are questions we don’t like to think about but really need to.  An article on Kiplinger.com, written by Erin Burt, brings up these scary scenarios and discusses how one can get started to save for a “rainy day”. 

Here’s an eye opener, according to the Bureau of Economic Analysis, our country’s personal savings rate dipped into negative territory in 2005.  That hasn’t been seen since the infamous Great Depression.  That’s not so good is it?  Well, there are several ways individuals can take control and start saving their money.  Ms. Burt tells us how. 

It’s recommend that you should have between three to six months worth of expenses saved in order to help out when an emergency arises.  How to go about that includes paying yourself first, plugging spending leaks and saving that “extra” money you get from work bonuses, raises and tax refunds.  Where to stash your cash is also important.  You want your money to be accessible, safe and profitable.

If you don’t feel motivated to start saving maybe this can be a motivator.  Erin Burt talks about a professor she once had who suggested looking at savings as a “go-to-hell fund”.  For example, rather than feeling like you have to keep a job because it pays well, you can simply quit and tell your employer where to go.  Knowing that you can have that kind of financial freedom and control would be nice, right?

This article is filled with helpful information that we should all think about.  Being prepared is just another important and responsible thing we can do for ourselves, and our families.

Antoher great place to check out clever ways to save money and help with budgeting is Mom’s Budget