38 Reasons You Need At Least a $500 Emergency Fund
The age-old saying,” When it rains it pours” is especially true when an unexpected emergency pops up- as if you had nothing better to do than fork out $500 on new tires, or visiting the doctor. Recently the Federal Reserve noted that almost half of Americans do not have $400 cash available in an emergency fund.
Almost HALF of America.
If you’re a part of the group that doesn’t have cash on hand for an emergency, you’re not alone. However, since the onset of the financial crisis, more people than ever are committing to being more financially stable and thinking like a saver.
That starts with building an emergency fund.
Because there will ALWAYS be an emergency. The only thing “unexpected” is when it will happen.
Now, it’s possible that you hear “Emergency Fund” and begin to panic a bit. Financial gurus have told us that we MUST have 3-6 months of our expenses saved for an emergency.
We understand that for someone just beginning on their saving journey, that goal can be overwhelming. That’s why we encourage our Savers to start small and think BIG by setting an initial goal of $500 for your rainy day fund.
In fact, we thought of 38 Reasons why having at least a $500 emergency fund could save you from a financial setback!
- Shattered, broken, or stolen cell phone
- Computer hard drive crash
- Emergency visit to the dentist
- Emergency visit to the veterinarian
- Replacing the AC in your home or car
- Minor car repairs
- Traffic tickets
- Replacing or fixing your vacuum
- Repairing your stove
- Broken refrigerator
- Broken instrument
- Travel for unexpected loss/funeral/celebration of life
- Root canal
- Washer/dryer repair
- Lost luggage
- Emergency plumber
- Lost or replacement of work tools
- Unexpected trip to the emergency room (copays)
- Work travel that you have to pay for upfront and then get reimbursed
- Electric garage door repair
- Home evasion –replacing items before insurance claims come through
- Unexpected move required for work
- Car gets towed
- Flat tire
- Missing work due to illness when you’re paid hourly and do not have sick leave/vacation/etc.
- Fender bender
- Flooded basement
- Limb/branch/tree falling on car or house
- Replacement key fob for car
- Calling a locksmith
- Lost glasses
- New tires
- Prescription costs
- Increase in utility bills
- Uniforms for kids sports or extracurricular activities
- Increase in grocery bills
- Rent increase
- Insurance policy increase
Of this list, chances are you’ve already experienced quite a few of them. And since we can’t really prevent them or know when Murphy’s Law is going to rear its ugly head, the one thing we can do is be prepared.
Saving isn’t a burden, it’s a mindset and lifestyle change.
The first step is to make a commitment to save your first $500 toward your emergency fund, then create a plan— one that’s feasible and sustainable.
Remember, completely cutting off all the things that make you happy and bring you joy in order to “save” will make saving that much harder. But, much like the tip given by Better Money Habits, choosing one thing to give up would be easier to stick to.
Now that you’re in the savings mindset and ready to be prepared for whatever life throws your way, head over to take the America Saves pledge, or re-pledge for “Emergency Fund” to get accountability and support to help you along the way.