Maybe you’ve already started to reflect on where 2019 has taken you, and what you want to focus on in 2020. You’re planning a trip, or figuring out how to get back to the gym regularly, or thinking of starting a hobby. But have you thought about your money?
Tagged With emergency fund
In last week’s post on How to Budget for Unexpected Expenses, I described sinking funds as “one of the best budgeting hacks ever,” which means it’s time for me to tell you how they work.
You’ve worked hard for this, and the day is finally here: You’re getting your first paycheck reflecting the raise you successfully negotiated. But as anyone who’s ever received a windfall can tell you, money has this tendency to disappear on you. One day, you’re looking at your newly flush bank account, the next, you’re looking at the same lowly balance you’re used to. Where did the money go?!
For months, we’ve been talking about our topsy-turvy economy and what it could mean for your finances if we experience another global recession. And while the sheer occurrence of a recession isn’t anything to get worked up about on its surface, the spectre of the previous GFC is still weighing on a lot of us.
If you’ve ever thought about having kids, I’m sure nothing you read and no one you talked to about it promised you it would be cheap. Quick reminder: It costs an estimated $300,000 to raise a child through age 17, according to Finder.
Everyone who reads this site has heard a thing or two about the importance of having an emergency fund. But when such an emergency comes along, how do you use that money wisely?
You might not have a ton of money saved or invested. And reading what you should have or should be saving — say, saving 20 per cent each paycheck, or having your yearly salary saved by the time you’re 30 — can be overwhelming. So much so that you just might not start.
It's a good idea to have some kind of financial buffer to help keep you in the black. The problem is, not everyone can afford it. If you're struggling to set aside money for things like an emergency fund, start small with a change jar.
Money experts don't agree on the particulars of emergency funds, but just about everyone agrees you should save for emergencies. Nobel Prize winner and "father of modern portfolio theory" Harry Markowitz offers his rule of thumb for setting aside cash for emergencies.