SAN ANTONIO – Emergencies can happen anytime, and if you’re not used to handling them, the aftermath could be costly if you haven’t saved enough money to cover your finances.
Saving for emergencies feels hard when bills are piling up in the mailbox, but it can save you a lot of headaches in the long run if you’re prepared financially.
The Consumer Financial Protection Bureau is providing some tips to help you put away even small amounts of money that can make a significant impact over time.
First, start putting aside what you can to help cover common emergencies, such as a broken motor or a trip to the hospital, which could become a costly debt if you're not prepared.
The CFPB said you should prioritize a dedicated savings account for these types of emergencies as one of your top savings goals.
Next, you should set up guidelines for how you can use your emergency savings fund. Determine what you think is an emergency, and don't be afraid to use your money. You should remember to rebuild the savings account from which you withdrew money.
If you want to make saving easier for yourself, set up automatic reoccurring transfers at a rate that works with your paycheck. These transfers from your checking to your savings can happen as frequently as every week.
The CFPB also recommends putting in any extra money you have into savings to help you during trying times.
Lastly, you can use your tax refund paycheck to help you reach your financial goals. You can plan to allocate a portion of those funds to go into your savings account.
For more information from the CFPB, click here.