4. Start an emergency fund. Sh*t happens! Instead of taking on more debt to pay for an unexpected car repair, use the cash in your emergency fund. That extra cushion of cash can go a long way in helping you achieve your long-term financial goals. When Kate and I were newlyweds, we always kept at least $1,000 in a savings account. There were several times when we were forced to dip into it for car repairs and the like, but because we had the money there, we never felt strapped for cash, even though we weren’t making much at the time.
Make it a goal to set aside $1,000 to start your emergency fund. I use CapitalOne 360 for our family. Once you pay off your high-interest consumer debt (see below), you can set the goal of creating a fund to cover 3-6 months of basic living expenses.
Discussion about this post