4 Jul 2017
It is is not surprising, according to a June 20, 2017 article on CNBC, “57 million have no emergency fund.” As you read this, ask yourself “Do I have $1000 cash in hand right now that I could use for an emergency?” If you answered “no” or if you can think of a relative or friend who would answer no, then please keep reading. This article is based on proven techniques that will give most people a monthly raise of $1000. (of course depending on your income it may be less, or it could be more).
The majority who visit my site don’t wait until an emergency to start saving for it. However, some have the best of intentions but never seem to actually start saving. If you aren’t saving money, how can you prepare for an emergency? Even if you are buying emergency supplies, everyone needs some cash on hand for an emergency, such as a car break down, appliance repair, insurance deductible, etc.
As a Dave Ramsey Certified Money Management Coach I know for fact that taking baby steps work and the first step is $1000 in savings, as a start. To be honest, things are getting so expensive that $1000 doesn’t go far, but you have to start somewhere. I highly recommend having at least $2500 in savings for baby step one, but let’s not get a head of ourselves.
$1000 In One Month
So how is it possible to save $1000 in a month when you are living paycheck to paycheck? Well you most likely already have it, it is buried in your lifestyle.
For example: You go to Starbucks or some similar coffee shop every morning, but you don’t need Starbucks for coffee, you can brew your own at home.
A standard bag of specialty coffee is around $8 and you can get about 35 to 40 cups out of that. You can even go with a cheaper brand like Folgers or something like that, get a large container which brews 240 cups for around $15. But let’s stick with the specialty coffee for this example.
Going to a specialty store for coffee each morning will cost you between $4 and $5 for a cup of coffee vs $8 for a bag for 35 cups of coffee that you make at home. Just making that little change you have put $100 a month into your emergency savings. If you and your spouse both brew your own cup you could actually save $200 between the two of you.
Now let’s talk about breakfast sandwiches and lunches. Same principle. Most people get a Danish or breakfast sandwich with their coffee, that is an additional $4 (on average). Then there is lunch out, average lunch now days is $8 to $10. Every day for five days a week, four week in a month that is $240 just for breakfast and lunch. Bring your own breakfast and lunch to work you just added an additional $240 in your emergency fund.
You have now saved $340 in the first month with three simple changes and I am only talking about one person. Add your spouse to this as he/she is spending the same each morning now you have saved $640 in your emergency fund for the first month.
Let’s keep going. Do you eat out for dinner? Yes, most of us do, we work hard, then we are carting the kids around, it is faster and easier to eat out for dinner most of the time. For a family of four, to grab a quick meal at fast food is around $32. Let’s just say you do that only three nights a week, that is $384. Eat home, even fixing a quick salad and a sandwich will save you huge and won’t take much time to prepare. Put that extra $384 in savings.
Simple Changes Add Up
By making just these few changes in eating habits, in one month you will be able to put approximately $1,224 in an emergency fund.
3 Ways…Let’s Recap, You and Your Spouse Will Save:
- $200 a month in specialty coffee each morning
- $640 a month in breakfast sandwich and lunch each work day
- $384 a month eating out with the family three nights a week
You will save:
- $1,224 in an Emergency fund in one month
Just these changes alone will save you $14,688 in one year….WOW! That is winning with money!
It will be an adjustment, but you will be surprised how easy it is to make your coffee and meals at home and take them to work, or each quickly as a family at night, especially when you start to see how quickly your emergency fund and savings adds up.
If your single the same principles apply, cut back and you could give yourself around a $600 raise a month, that is $7200 a year.
For one month, give it a honest and faithful effort and take the money you are saving from eating out morning, noon and night and put it into savings, an account that the family does not touch for the month. See how quickly the savings adds up.
It will work if you work it.
Let me know below how it goes.