Have you ever had to go into debt or eat into your savings because of an emergency expense coming up that couldn’t wait? Maybe your washing machine broke down and you needed to replace it? Or your car had to get a repair that you hadn’t counted on? Did you ever have a plumbing issues that really had to be fixed as soon as possible?

In most of these cases you often can’t NOT pay for the expense as that would only create more problems, damage or costs. But if you don’t have any money set aside that you can call upon for when these types of unexpected expenses come up, it can be almost impossible to find the money to deal with the problem in the moment without either taking on more debt or using money from your savings that was potentially already earmarked for something else.

The fifth challenge of our 31 Challenges this month is to therefore start putting together an emergency fund. In that way you will always have some money set aside to deal with emergencies such as described above. Aiming for roughly $1,000 is usually a good guideline, but of course adjust this as needed. Continue reading “Day 5 / 31 – Start an emergency Fund” →