Saving for a “Rainy Day” – Why Saving Money Is Important
Many of us have gotten out of the habit of saving. We know we are supposed to, but we’ve adopted lifestyles that have us living pay cheque to pay cheque. The result is that when things get a little difficult financially, we can lose everything.
Even minor financial setbacks can become major events, causing stress, unhappiness and financial loss. Saving for a “rainy day” is about more than doing what you’re supposed to do – it’s about taking good care of yourself today, tomorrow and every day in your future.
Imagine being able to always afford life’s little emergencies. Here are just a few of the common little emergencies we face on a regular basis. Perhaps one or two of these resonate with you.
* When your car needs a repair
* When your hot water heater explodes
* When your computer crashes
* When your child breaks a bone
* When your dishwasher just up and dies
* When your child needs money for a school trip
* When your couch breaks
* When your pet needs surgery
These little emergencies can feel huge when you don’t have the cash in the bank to cover them. Yes, you can charge them, and many people do, but if you’re living pay cheque to pay cheque, paying the monthly credit card bill won’t be easy.
However, if you have a rainy day savings account, these “little emergencies” are just that – little. You can easily pull money out of your account to pay for the expense and go on with your life. You deserve the luxury of peace of mind, you deserve the freedom from stress and you deserve the financial confidence to know you can pay for the surprises life throws at you.
How Do You Start a Rainy Day Account?
If you’re like many people, you’re living pay cheque to pay cheque and you’re not quite sure how you’re going to save anything. The key is to look at what you do spend your money on, like Starbucks, take-out, dry cleaning, super expensive cell phone bills, a lawn service and so on. Find a way to cut back your expenses by a few dollars a day. For example, if you spend $3 at Starbucks each day, you can save $90 a month.
You can also sell something to launch your savings account. Do you have a few dresses, coats, or even technology you don’t need or use any more?
How much should you save? Experts recommend putting away $1000 in your rainy day fund. Once you reach that amount, consider continuing to save but putting it into your retirement instead. If, however, you have a large deductible on your health insurance, like $5000, consider saving that much. That way you’re covered in the event of a health emergency.
Put the money into an account that you’re not likely to touch. And if possible, use automatic dedications to put money into the account weekly. Something like $25 a week is a good amount; however, if you can put aside more, do so. The sooner you have your rainy day account funded, the faster you’ll achieve peace of mind – it’s worth it!
Saving for a rainy day isn’t always easy, but you’ll be happy you did it.
Tags: Rainy Day, save money, Saving Money
