How to Quickly Build Your Emergency Fund

Last week we covered some tips on how to establish a budget. But if you want to stick to that budget and avoid building debt, research indicates the best way to do this is with $1,000 in an emergency fund. Ideally, you’d have 3-6 months of income put away. But $1,000 is a great start!

Nobody is immune to unexpected financial troubles. Anything from a medical bill, to a broken heater, to car trouble can quickly rock the foundation of your family budget. If you don’t have a windfall, you’ll have no choice but to turn to debt.

So, this week I’m sharing my favorite ways to quickly build your emergency fund to protect your finances long-term.

Find Hidden Money

Where do you have ‘hidden money’ in your budget? I use this term to describe little luxuries that you don’t really need or use, hiding among other necessities in the budget. For example, of course you need grocery money. But do you need name brand or off-sale items? You can save around $20 or more each trip just by planning meals around sale items.

Cable is a big one. Many people avoid cutting cable due to sports programming. But I’d hazard to guess you could watch the game from a nearby restaurant or friend’s house for far less money than your cable bill outlay.

I suggest taking a microscope to every line item of your budget to discover where you can rethink some spending.

What to Purge, and Where

If you’ve cut every unnecessary expense, the next best way to save is bring more money in. It’s time to take a trip through your home and peruse your storage bins for unused items to sell. For the bigger ticket items (like a tablet or furniture), opt for an online ‘swap and shop.’ That’s where I have the best luck moving items quickly to get cash in hand.

For smaller items that you’re unlikely to sell online, compile them for a weekend garage sale. Whatever you don’t sell can be donated for a tax deduction. 

Non-traditional Income Flow

There are so many ways to earn a second income these days. A few of my favorites are moonlighting as an Uber driver or renting space through a site like HomeAway — walkout basements work great! These require less time than a traditional part-time job, offer flexibility and can be squeezed into a busy schedule with less disruption.

While this exercise in financial discipline isn’t always fun, take solace in the fact that it’s temporary. You won’t always have to cut back or earn extra once your savings is in a good place. But an emergency fund will protect you from financial bumps in the road, and is absolutely worth the effort.

Kat’s Money Corner is posted in the Kansas City Star every week. Kat Hnatyshyn, when not blogging or caring for her little ones, is a manager with CommunityAmerica Credit Union. For more financial chatter, follow us on Twitter @CommunityAmerCU.



"you could watch the game from a nearby restaurant or friend’s house for far less money than your cable bill outlay" << This is fine of the idea is the nearby restaurant ... but why depend on a friend? That friend is PAYING for the privilege of being able to watch sports whenever they want to. They may not want people horning in on their game night. When my daughter was in junior high, she had a cell phone. We PAID each month for her cell phone. An acquaintance of mine said they didn't want the expense of getting their child a cell phone (they could afford it ... they owned three cars with two drivers). She figured her child could just borrow someone else's if needed. So *I* have to pay for *her* child to use a cell phone? If you can't afford it, don't use it, unless YOU are invited over for that sports night.
Back To Top