3 Ways to Create a Rainy Day Fund
Having a rainy day fund is a necessity that all of us should aim for. Sadly, lots of us struggle enough to make ends meet without the added strain of putting money into a savings account. A rainy day fund, otherwise known as an emergency fund, is a sum of money you can use in the event of an unexpected situation such as losing your job or having to pay for car repairs.
Experts suggest that the fund should ideally contain at least three months worth of money to cover your usual outgoings. Take a look at these tips for effortlessly creating a rainy day fund.
Invest your money
If you what to invest your rainy day fund make sure to seek out a reputable company. RW Invest, who have a trusted name within the property industry and a proven track record for success. Using a good company can help you find the best opportunities that meet your budget. Please note that investing your money can be risky and in some cases you may lose money. There is always risk involved when you investment.
If you’re looking for a more secure and fool proof place to save your back up money a savings account may be a better option for you. Look for a savings account with high interest to put your money to better use.
Focus on budgets
Budgets, budgets, budgets. If you’re keen to generate a significant amount of savings, then budgeting is, unfortunately, something you need to do. While it can be hard to stick to, putting a monthly budget in place is helpful. A monthly budget lets you see where your money is going, providing better clarity on how you can spend less.
If it helps you, you can use tools to track your budgeting efforts. There are some great tools out there, such as the downloadable budgeting spreadsheets and savings apps. Calculate the amount of money you have left after all of your outgoings. This will show you how much you can afford to put towards your rainy day fund.
If it would help you to save more consider a money saving challenge. There are plenty of challenges, suitable for all budgets that you can take part in.
Make some extra cash to boost your rainy day fund
If you’re not making enough money to be able to invest or be left with expendable income, then you might need to look into making some extra income. If you have some free time, focus on using your products or services to earn money on the side of your usual job. Use a website like People Per Hour or Fiverr to find freelance jobs. If you have a skill such as copywriting, graphic design, or web design, freelancing is a great option for you.
If you’re not keen on freelance work, selling your unwanted items is another great way to generate some extra money. You could do this the old-fashioned way by selling items at a car boot sale or put some listings up on sites like eBay. Plenty of people have earned £1000’s from selling their old, unwanted items.
I’ve saved £1000’s towards my rainy day fund with lots of side hustles. You can earn lots of money by effortlessly downloading an app, adding a browser extension or shopping through a cashback website.
If you can manage to put away some savings each month, a rainy day fund is a very sensible approach. I’m fortunate enough to be able to save 20% of my monthly wage. If you have debt it might be worth considering paying this off before starting a rainy day fund.