Saving For The Unexpected: 5 Tips
If one thing is certain, life is very unpredictable. Every so often, when you think you have all your ducks in a row, something comes out of nowhere and disrupts the good times. At times, this is through emergencies that require money to fix.
To make things worse, such occurrences can come up when you do not have much in the way of savings. Granted, you can get payday loans in Canada, borrow from friends, and so on, but having a financial cushion remains the best way to go.
How can we create and grow an enviable savings kitty? Here are five tips.
1. Create a Budget
A budget is useful for your savings because it shows you your income, expenses, and any surplus amounts you might have. This surplus is what should go into the kitty. If you have none, this calls for more extreme actions, as this is a sign that you are living beyond your means. This makes it virtually impossible to save.
2. Open a Savings Account
Among the best things you can do for yourself is open a savings account separate from your current account. This is where your savings should go, and you should not draw from this account to sort our running expenses. If you stick to your budget, this should be easy to do.
You can also have a standing order at your bank, where a specified amount goes into the savings account immediately after your salary comes in.
3. Make Additional Income
To kick start your savings, it might help make some additional income from a side hustle or take up extra shifts at work. Because you already have a working budget and your living expenses are taken care of, all the income from this venture should go to your kitty. Not only will this help you jumpstart your savings, but it will also motivate you to see your savings account grow.
4. Cut Spending
People at times waste little amounts of money here and there that seem insignificant. Over time, however, these amounts add up to something. Evaluate what these are in your life and make some changes. Think buying a bottle of water or coffee daily, buying lunch instead of carrying a packed snack to work, and so on. These small amounts can be directed to your savings kitty.
5. Invest Savings
Once you have a significant amount saved up, think about ways to invest the cash or a portion of the money. This helps you grow your money and, in turn, your savings kitty much faster than having the cash sit in an account.
Start Today
The best time to start on any goal is to get on it immediately. The sooner you start, the sooner you begin seeing results, which is a motivating factor.