When you decide on the amount that you want to establish it can feel like a long road before you reach it.
I felt like it took me a long time to build our emergency fund, I wanted that dollar amount in my account but I didn’t have the patience to do it slowly.
I thought if I couldn’t have it all at once in some windfall amount there would be no doing it. I was wrong.
Just Start!
Eventually this is what I did. I just started. Though it didn’t seem like that $20 was going to do anything, within a few weeks that $20 was $100 and I liked that number even more.
I went in with the mentality that if I had enough money for something totally unnecessary, like nail polish or a fancy coffee, I had enough to put in my ER fund account too, if I couldn’t do both I had to pick and ER fund always won.
Delegate Windfall Money
I can’t say I get windfall money often but I did get a few hundred dollars at Christmas time from my boss that I wasn’t expecting.
Since it was unexpected and thus, un-budgeted, I put it all in my savings account for the emergency fund.
The same goes for change in pay. Since I’m paid hourly and not salary, it varies. I do my budget based on an average amount, if there is more, even just $20 I appropriate it to the ER account while I’m building it up.
Sell Something
Though I prefer to just donate things to people in need, sometimes I may have something of value that I can sell.
The only thing I won’t sell and put in my account is if I sell something of my daughters. Since it was something that either we bought for her or someone else bought for her, it wouldn’t be fair of me to sell for my own profit.
I’d put the money in her account instead.
Earn Extra Money
There are a ton of ways to do this from picking up extra shifts at work to earning more through a side-job, of you earn money that isn’t within your regular budget save it until your emergency fund is maximized. Try passive income.
Tax Refund
Though this may go under the windfall money category, if you get a tax refund good use of it would be to beef up the savings!
Once your emergency fund is at a level you’re comfortable with, delegate any of your extra money towards your next financial priority, whatever that may be but don’t do anything else, additional debt payments and all, until you have a realistic emergency fund in place.
How did you build your emergency fund? How long did it take?
Nice list. I’m building mine right now, mostly through regular paycheck transfers (my ‘extra’ or windfall money is going into my retirement account) and it just seems like it’s going *so* slow; I’ve used it for a few things, so it keeps getting knocked back down. I’ve been working on it since last summer and it’s only up to $2000! However, I may finally be getting some momentum so I’m hoping things keep moving upwards.
Over many, many years. We have a built a nice e-fund. I think one of the issues with personal finance is people fixate on just one goal, instead of working towards multiple at the same time.
Sarah, I also sell some of my things so I can increase my emergency fund. Donation? Honestly, I rarely do it. Haha! I’d rather sell my things for extra income.
I beefed up my savings this year with the help of my tax refund. I also have a few “side hustles” that I do (selling on eBay, paid surveys, second job, etc.) and my goal for 2015 is to save every single penny of “extra income” (meaning anything not earned by my full time job). I’m also saving my “cash back” earnings from one of my credit cards. I know, I know. But I have and STICK to a budget for what I spend on my credit and so far I have $40 in cash rewards! 😀 (and a zero balance on the card. I only use it for the categories that offer substantial cash back – such as groceries/gas.) hehe.
YAHOO!
Our original emergency fund was funded almost entirely from a yearly bonus. Right now I’m trying to beef it up slowly at $50 a month. It’ll get there.