28 Feb Save for an Emergency Fund
Emergency funds are bank accounts set aside to cover the cost of unplanned events such as large medical expenses, a job loss or a major home repair. Generally, emergency funds should cover three to six months’ worth of living expenses if there is no other income during this time. While many people see emergency funds as necessary, others have trouble finding room in their budget to start one.
Here are some practical ways to save toward an emergency fund:
Monthly contributions:Decide on an amount that you’ll save each month for your emergency fund and set up an automatic transfer from your checking account.
Change collection: If you are a frequent carrier of cash, place a jar in your home where you can store change and single bills to save toward your emergency fund.
Transfer extra cash:If you have paid all necessary bills for the month and have extra cash in your checking account, consider transferring it into your emergency fund rather than spending it.
Bonuses and tax refunds:Bonuses and tax refunds are great resources to help bulk up your emergency fund. Consider saving some, if not all, of the extra money rather than spending it.
As you build your emergency fund to plan for your future, make sure to only use it for emergencies — which should be classified as things that affect your health or ability to earn money.
At Fairway Fort Lauderdale, we would be happy to talk with you about mortgage options that allow you to use a down payment of less than 20%. Interested in moving to Fort Lauderdale or buying a new house? We are here to help you! Call us to set up a time when we can review your finances and goals to determine the best home loan program for your situation.
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