5 Things You Should Know About Emergency Fund Savings
The importance of having an emergency fund has been gaining traction in the last few years. In 2020, it became ever clearer that having some cash saved up to cover necessary expenses amid a crisis is paramount to one’s financial health.
If you wish to hop on this healthy financial trend, set up an emergency fund, and gain financial security, here are a few things you need to know. In addition, we show you how to use your car title for cash if an emergency hits while your emergency fund is still small.
5 Things You Need to Know About Emergency Fund Savings
1. Starting An Emergency Fund Is Simple
You don’t need a long-term plan to start saving for emergencies. It’s, after all, not going to be a one-and-done process – you have time to figure out where you want to get.
If you’re delaying because you don’t have a game plan yet, then you’re losing precious time over nothing.
2. The Easiest Way to Start Is to Automate Your Savings
Spending money is the easiest thing in the world. If saving is your last priority, you aren’t going to get far.
It’s better to automate your savings and have a portion of your paycheck automatically transferred to a savings account when it comes in. Think of it as a beneficial pay cut.
These days, most experts agree that saving around 20% of your income (in one way or another) is an optimal move – so that’s what you should try to aim at. But you don’t need to start this big if you’re still getting cold feet. Even if you save only 5% of your paycheck for the time being – that’s still more in savings than you had before.
3. An Emergency Fund Isn’t Designed for Planned Expenses
An emergency fund isn’t supposed to cover all your large expenses. If you know you might have to cover certain large expenses, you should save up for them separately from the fund.
These savings are sometimes referred to as sinking funds.
For example, if your car suddenly breaks down and you need to urgently get it to a mechanic, you can cover that from the emergency fund. But if you know the time for your car check-up is coming up, you should save up for that independent of the fund.
4. There’s No Ideal Set Amount for An Emergency Fund
Each person’s emergency fund should look different based on their income, health, work condition, family situation, living area, etc.
You won’t find a perfect set amount anywhere on the internet. Though financial experts generally agree that the emergency fund covering around 6 months’ worth of expenses is optimal, they often have trouble deciding if that should include only basic necessary expenses or general spending as well.
It’s up to you to find out what works for you.
5. Putting Too Much Money in An Emergency Fund May Be A Bad Idea
Interestingly, at a certain point, an emergency fund could potentially start losing you money.
While an emergency fund is important to have, it’s there as a cushion, not to make you more money for the future. This is money you could be investing. So, all the extra money you could have invested but put in the emergency fund instead can make you lose some potential financial gains.
Handling Emergencies Without The Emergency Fund
Unaccounted expenses happen with everyone – there’s no way around it. This is why it’s so important to have a well-set emergency fund. It acts as a safety net, allowing you to take certain risks, and mitigating money-related stress.
But having an emergency fund isn’t a quick process. It doesn’t happen overnight. And if you’ve only just started you might still have to resort to outside help if you suddenly get hit by an unexpected expense.
Title cash loans can be one of the options to consider, especially if the problem you’re dealing with is time-sensitive and you need to get cash as soon as possible.
Title loans are accessible, easy, and fast – when you apply for a loan with Idaho Title Loans, Inc., you could get the cash the very same day.
Idaho Title Loans, Inc. is open to all potential borrowers regardless of their credit situation and income source. All you need is to be over 18 and outright own your car.
How to Get Idaho Title Loans:
First off, you would need the required items. Your car, the car’s lien-free title in your name, and a valid state-issued ID/driver’s license proving you’re over 18. After that, you can easily start the application process online by submitting an online form on Idaho Title Loans, Inc.
In a few minutes, the form will get processed and you’ll be contacted by the representative of your local branch with further instructions and to schedule a meeting with you.
Take the required items to the meeting the representative sets up. They’ll need to inspect the car and the documents to determine what the terms of your loan would be. If you qualify, which could take as little as 30 minutes, you’ll get the cash the very same day.
Emergencies Don’t Have to Be Mentally Costly
There is always a solution to your financial problem, even if you did not form a strong emergency fund yet. That is because Idaho Title Loans, Inc. is here to help you. Apply for your title loan today and find out how much cash you could get!
Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.