Are you one emergency situation away from bankruptcy?

Are you one emergency situation away from bankruptcy?

Many people are not doing well financially. We’ve got too much debt, and plenty of people are forced to work a side job just to get by. Unfortunately, we’re also trying to ‘keep up with the Jones’s’, which means we’re usually spending more than we can afford.

All this means that most people don’t have nearly enough in savings to cover them if they were to have a sudden emergency situation. Take a moment to think about what you would do if your car suddenly blew up, you lost your job, or you were too sick to work. Sound scary? These things happen to thousands of people every day. Of course, there are some great options like which can be a lifesaver if you simply don’t have the money you need when you need it.

Ideally, though, we’d all have six months of savings in an easily accessible bank account. If this doesn’t sound like your financial reality, now’s the time to make it happen.

Here are some tips:

Examine your spending

If the idea of watching every penny makes you shudder, it might be because you know you won’t like what you find. In order to be financially responsible, you need to understand where your money is going. Track your spending, and take a good hard look at how much you’re paying for dinners out, coffee, clubbing, and shopping. If this is shocking, it’s a good sign that you could probably cut back a little without noticing a massive difference.

Create a savings plan

Your first saving goal should be to have at least a few thousand set aside to help just in case you have a financial emergency.

Next, consider what else you’d like to save for. Maybe you’d like to start a college fund for the kids, buy your first home, or save for an investment property. There are many resources online to teach you about the best accounts and services for this type of saving. Create a plan and some goals along the way and commit to sticking to that plan.

Talk about money

It’s easy to assume you’re the only one struggling financially, but you’re likely to find that this isn’t the case at all. Talk to your friends about your savings goals. Let them know you’re cutting back on your spending. Often, they’ll agree that they’d like to do the same, which can be excellent for cheap socializing.

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