9/14/2016

Creating a Cash Buffer

It is a good idea to have some extra easily (but not too easily) accessible cash for emergencies. 

True emergencies- car repair, home repair, health bills. 

The easiest way to do that is to save a small amount each month and don't touch it! Cut back where you can for a few months to do it. I find I can cut back, usually, on my groceries. If you are like me you have lots of food in your pantry and freezer. You just might have to get creative to use it all up. 

I find we eat out a lot! We can cut back on that and eat at home more. Using up the food in your pantry and freezer may get boring for awhile but if you have a cash cushion saved up you won't have to worry as much later if an emergency comes up. 

If you get a windfall or tax refund save that for emergencies. Most people want to treat themselves but it is more of a treat to not worry where the money is coming from in and emergency. 

It is also a good idea to add to that savings every month. Even if you have the usually recommended amount of $1000. You never know if the next emergency might cost more. Old fashioned, yes, but better safe than sorry.