How to Build an Emergency Fund in 6 Easy Steps

Exactly how to build an emergency fund in six easy steps.An emergency fund is like your own personal safety net. It’s money that’s there when you need it without having to jump through hoops, wait for outside approval, or pay interest.

(Which reminds me, the idea that it’s smart to get a credit card for emergencies is nuts if you ask me. Get money for that instead. Much better than going into debt when you’re stressed out already! Or anytime really.)

An emergency fund gives you peace of mind when it’s not being used, and it can save your rear when you do need to use it. So how do you build one, especially with all the other pre-existing claims you’ve got on your money?

Here’s how to do so in six easy steps.
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How to Build a Starter Emergency Fund in 30 Days or Less

Step-by-step tips on getting an emergency fund startedAn emergency fund can come in REALLY handy, giving you a cushion in case of job loss (or whatever else you deem an emergency). But building one is another story, right?

According to Bankrate.com’s monthly consumer poll, “28% of Americans have no emergency savings — none at all — and nearly half, 49%, don’t have enough to cover 3 months’ expenses.”

But you don’t have to be a statistic. Here’s exactly how to build a starter emergency fund in 30 days or less.
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Emergencies Happen

Have you ever wondered why Dave Ramsey’s Baby Step One is to create a thousand dollar beginning emergency fund?

It’s because emergencies happen, to all of us.

$1000 is the beginningHaving actual money on hand to pay for those is the first line of defense against borrowing. In other words, an emergency fund helps you end the cycle of debt.

What is an emergency, really?

If you look in the dictionary, you’ll see that an emergency is defined as “a sudden, urgent, usually unexpected occurrence or occasion requiring immediate action.”

Unfortunately, too many of us take that to mean “something we forgot was going to happen”. You know, like needing new tires for the car because the old ones eventually wore out, or getting new clothes for the kids because the new school year is about to start and they’ve outgrown their old school clothes.
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