When you are trying to get out of debt, it is best to have a little safety net for “just in case.” The old saying says anything that can go wrong probably will and you need to have some money set aside for an emergency. The magic number is about $1,000.
This will help you if you have an honest emergency. It’s always nice to have it available. This emergency fund isn’t for the loss of a job or an illness. This is just a little something so you can work on the money that you owe everyone.
What is an Emergency Fund for?
Typically, the emergency fund is 3-6 months of expenses. Expenses meaning the cost of the things we need to live. Things like shelter, heat, food, transportation, and electricity. These are the necessities. we are working on the baby emergency fund while we get out of debt. That starter EF amount of $1,000.
Deciding to put it someplace that is a little tough to get to yet can be accessed in just a few hours is your best bet. But don’t let temptation screw this all up. You know you. How much self-control do you have?
If you haven’t done this yet, now is the time. Sit down and do the work.
Use cash. That way, you won’t be overspending at the grocery store or Target because you only have a set amount of cash to spend.
Take that date night money and put it toward EF. Instead of spending $75-$100 on dinner and a movie, pack a picnic and go to the park. Find some free music or free play instead. Grab a cup of coffee and split a piece of pie at a cool diner.
And lastly, start a side hustle. Something to put cash in your hands right away like babysitting or delivering pizzas. Maybe you know a friend who can get you a job waiting table for the summer or walking dogs while someone goes on vacation.