Little Ways To Pad Your Emergency Fund

An Emergency Fund is an essential part of a solid financial foundation. It is a cash cushion that you have accumulated over time. It should be easy to access, and to be used only for an emergency.

Some so-called experts will say that you should have 6 months worth of salary in your Emergency fund. Others say that having only $500 to $1000 set aside is a good start. You have to decide what amount is right for you and your family. I am rebuilding my Emergency Fund after having to use it this past fall. I’m starting small, with a goal of $500 by the end of February.

Here are some Microsavings tactics to help pad your Emergency Fund:

·       Automated transfer $25 from your paycheque. You have to start somewhere.

·       At the beginning or end of the week, transfer the last three digits of your bank balance over to your E-fund. (If your balance is $542.68, transfer the $2.68.)

·       Save your pocket change. 50 cents a day can add up over a couple of months.

·       Sell something and put the proceeds in your fund. Kijiji is my personal favourite to sell unwanted items.

·       Add government cheques like GST/HST or your income tax refund.

·       Add amounts equal to your ‘spending – savings’. If you buy groceries and reduce your out of pocket expense by using $7.50 worth of coupons, transfer that amount to your Emergency when you get home from the store. Same goes for your loyalty rewards points accounts.

·       Have a No Spend/Low Spend month to reduce your variable expenses and deposit the difference.

·       Round up your budget categories. If you spend $146.50 on cable/internet, budget $150. At month’s end, sweep remaining funds into your emergency fund account.

·       Replace one bad habit with a good one: If you smoke ( or whatever your vice is), smoke one less cigarette a day, and put $0.30 into your change jar. At month’s end, deposit into your E-fund.

·       Make something you can sell; sewing, knitting, woodworking, and card making are all viable types of side income for boosting your e-fund.

·       Do some babysitting, pet-sitting, house sitting, snow shovelling, attic cleaning or whatever to earn a little extra funds to pad your account.

·       Reduce your consumption of meat for a week or a month. Whatever you would have spent, add to your E-fund.

·       Skip a take-out meal or two (or a month). Save your money instead.

To have a fully funded emergency fund, you have to start somewhere. I am a firm believer that having an Emergency fund is part of a healthy financial plan. I won’t tell you how many months worth of expenses you should have, only that you should have an Emergency Fund. So should we.

Here’s to starting over, in a new year, with renewed hope, and renewed focus. 51 days to $500.

I'm Stoked!!

Emergency Fund Daily Savings   

July 25: ??? / $800

As you know, I made my goal for the month of July to be all about the Emergency Fund. I talked about it the other day, saying that I would nickel & dime it to $1000 if I had to.
Here's how it's panning out so far.

I took the time to sit and roll the coins that were sitting in our 'penny jar' and to count them all. There was even a $5 bill stuffed in there. There was $74.00 sitting there, just waiting to go to the bank.

Add that to the $50 from my pay that also needs to go in the bank, it now becomes $ 124.00!

I also had a cheque in my wallet from someone that I had loaned money to. Add $42.50 to the count, and now the deposit being made tomorrow is $166.50.

For this week, I had decided to transfer over $35 for the week, instead of doing $5 every day. That turns my deposits for the week into $201.50.

So, as of today, there is $476.21 in the Emergency fund. Add tomorrow's deposit of $166.50 and you get:



Emergency Fund Daily Savings = $642.71

That leaves only $357.29 left to get the account to $1000.   

I think I can, I think I can, I think I can!

I'm so excited I could just burst. I want to have that $1000 in the bank by the time we leave for the cottage on August 6th. Hubby & I have agreed that if we can have it all in the bank by then, we treating ourselves to pedicures and 1 Tim Horton's coffee each before we hit the beach!

December Goals

Every month I like to set some goals that push me toward fufilling year-end goals, or to help with other aspects of life that I need to focus on.

December 2010 Goals:

1. Get RRSP to next level of $1500. (Unlikely to happen, but I'll never know if I don't try.)

2. Prepare all financial goals in writing for the year of 2011. I don't like waiting until the week between Christmas and New Year's to do this. Makes me feel rushed.

3. Get back on track with monthly spending plans, and tracking. (I need to keep a notebook of where all the money is going.)

4. Break down written goals into quarterly and monthly goals, so I have a plan for the entire year.

5. Prepare Debt Free Plan. Write out what we need to do to get rid of our debt in 18 months. (This is a lofty goal, but I know it can be done, if we tighten the belts a little more.)

6. Get passports for February vacation. Don't know where we're going, but as long as it's somewhere warm, I'm happy. We already have the money saved for this, so now we can focus on the vacation itself.

7. Have business stuff caught up to year end. There's lots to accomplish still, and I want to be as prepared as possible.

8. Go back to November goals and deal with whatever hasn't been dealt with yet. I had some things on my to do list that I never got around to. Time to stop procrastinating!

9. Enjoy the holidays with friends and family. December gets busy, and this one will be no exception. I plan on renewing some familial relationships, and I hope to be able to stay in contact throughout the year.

10. Get the baby blanket finished before the baby comes! It's a race now, which will come first? The baby or the blanket? Ha ha ha! I can't wait to meet my grandson.

Only 24 sleeps until the big holiday. Are you ready?

October monthly challenge

B and I went out for some fun last night. We met a friend, had a couple of drinks, and they sang some karaoke. We haven't had a regular entertainment portion of our budget in ages, so I thought we should include it so we can have some fun.

After we got home, we did some conversing about our priorities and what we hope to accomplish by the end of the year. We talked about taking that 'grown-up' vacation in about a years' time, after we have saved the money for it. I can't put all our priorities in a numbered list, as we will have to work on all of them at the same time, but there are some that will be given more focus every month.

For October, my monthly challenge will be to fully fund our XMAS fund. The goal for this one is to have $1100 in that account by months end. The amount needed to achieve this goal is $414.68. We have 30 full days to focus on this, so we *should* be able to reach this goal.

My second challenge this month is to prepare as much as I can for a baby shower I am co-hosting for my daughter, which is scheduled for November 21st. I'd like to have $500 set aside for this, to pay for food, favours, etc. Five hundred dollars may sound like alot, but the guest list is about 50 or so people. Is this too much? I doubt it, but I would rather have money left over than to not have saved enough.

Other things to work on this month:
- make 12 xmas gifts for friends and family
- open savings accounts for both the kids
- explore RESP options
- work on a payment plan for the retainer fee for lawyer

Last month, I challenged myself to find an additional $400 to reach a goal, and I did it. This month I am challenging myself to put away $914.68 for two goals. This may be stretching my limits, but I'm game to try.

I am totally stoked about October, as it is my favourite time of year. Halloween decorations for a month, and trick-or-treating top my list of things I'm most excited about this month.

Month challenge update

I was looking add $400 to the Emergency fund this month, to hit the $1000 goal. It seems that I may have been able to accomplish this in less time than expected. Let me explain.

As I stated in my Monthly Challenge post, I was able to contribute our regular monthly amount of $100 and carved $50 out of a 0% interest credit card payment. There were several other areas that I was looking at to find the other $250 needed. I found it in the least likely place, one of our fixed expenses...our rent!

The rent on our modest 3 bedroom apartment was slated for another rent increase at the beginning of October, from $976.26 to $996.25 per month. We were given the appropriate amount of notice. But I had questions. The lady in the rental office was as confused as I was as to why my rent was higher than others, and going up again. After some investigation, she found it was because we had failed to renew our lease.

B and I had a quick discussion, and agreed to sign another 12 month lease, with the rent being decreased from the current amount down to $959/month, which was what we paid when we first moved in two years ago. Yay us! A monthly difference of $37.25 per month than what we had budgeted to pay. That calculates into a 'savings' of $298 over the next 8 months. I budget yearly from June to May due to my contract. The only thing I need to do is to transfer the $250 from one account to the E-fund account, which is scheduled to happen in the next couple of days.

I will have achieved my monthly challenge goal in under 15 days! The additional $48 dollars from the rent budget will be left in the rent account to earn interest with the rest of the rent.

Cutting back in other expense areas hasn't gone as well as I had hoped, so there is no money being transferred to savings from there. I am still saving $5 bills and pocket change to roll at the end of the month. I'm hoping for $100 from this action. Contract work has come in, to the tune of about $400. To get ahead on the next goal of increasing the Xmas fund account to the $1100 goal, I will put 25% into that. Another 25% will go into the biz saving account (for things like taxes and new equipment). The last 50% will go into the household account for October's expenses.

It looks like I will have to work on 2 goals next month anyway, so getting a head start on them isn't such a bad idea.

September 2010, Monthly Challenge

I have a list of things that I would like to accomplish, goals, and things to work on. Every month I will be working on several of them at a time, but I will pick one to be my main focus for that month. Any extra money, time and effort I can pour into a project will be put on that month's challenge.

For September I have picked :

Goal #1. Have $800 in e-fund account. DONE (3 year goal is $12,000).

This should be a fairly easy one to accomplish. We already have $600 saved in this account, so finding an additional $200 this month shouldn't be too hard.

If you are a follower of Dave Ramsey, you'll know that Baby Step 1 that he advocates is to have $1000 in an Emergency Fund to get you started. If I can manage to drop an additional $200 into this account in September, then our E-Fund will be at the $1000 mark, surpassing our year end goal.

How can we achieve this:

I have $100 automatically going into this account on the 1st of the month.(100/400)DONE
I can cut back the payment to 0% interest CC by $50. (150/400)DONE
I can try to cut back on monthly expenses like groceries, gas, etc.
I can save up my $5.00 bills.
I can save and roll any pocket change this month.DONE
If I get any contract work this month, I can put 25% of the pay into this account.DONE

Once I have the $1000 threshold for the E-fund, I can redirect the monthly amount toward other savings and debt until year end, giving those a boost.

Do you have any other suggestions of ways to make up this $250 this month?