Tired of stressing about unexpected expenses? Imagine the peace of mind that comes with knowing you can handle whatever life throws your way.
We've all been there – that surprise car repair, the unexpected medical bill, or the sudden job loss that leaves you scrambling. But what if you had a financial safety net?
In this newsletter, we're focusing on building your first emergency fund – a stash of $1,000 to $3,000 that can help you break the cycle of using debt during those "uh oh" moments with tackle them with confidence.
Your First Emergency Fund
Your first emergency fund is like your financial foundation. It's that initial cushion to cover those smaller emergencies that pop up.
Think of it as your "break the debt cycle" fund. Instead of reaching for your credit card when something goes wrong, you'll have your own money to tap into which breaks your reliance on using debt.
This is your starter emergency fund. Once you are out of debt you will go back to this again and save a much larger sum of money. For now we are focused on saving our first $1000 - $3000
"Unexpected expenses are a part of life. An emergency fund is your peace of mind, knowing you can handle them without going into debt." – Michelle Singletary
Why Do People Fail to Save?
We get it. Saving money isn't always easy. Life gets in the way, unexpected expenses pop up, and sometimes it feels like there's just not enough to go around. But understanding why people struggle to save can help you overcome those obstacles and reach your financial goals.
The "I'll Start Tomorrow" Trap:
It's easy to put off saving, thinking you'll start next week, next month, or next year. But "tomorrow" never comes, and before you know it, years have passed, and you're no closer to your financial goals. Procrastination is a major hurdle when it comes to saving.
The "I Don't Make Enough Money" Excuse:
Many people believe they need a high income to save, but that's simply not true. Even small amounts, saved consistently, can add up over time. The key is to start where you are and make the most of what you have.
The "I Don't Know Where to Start" Dilemma:
Saving can seem overwhelming if you don't know where to begin. It's important to create a plan and break down your savings goals into smaller, more manageable steps.
The "Lack of Discipline" Hurdle:
Saving requires discipline and commitment. It's easy to fall off track when faced with temptations or unexpected expenses. Building good financial habits and staying motivated are crucial for success.
The "Fear of Missing Out" (FOMO):
In today's social media-driven world, it's easy to get caught up in comparing yourself to others and feeling pressured to keep up with the latest trends. This can lead to overspending and neglecting your savings goals.
The "Emergency Excuse" Cycle:
Unexpected expenses happen, and they can derail your savings plans. But if you don't have an emergency fund, you will end up relying on credit cards or loans, which can lead to a cycle of debt.
The "I Deserve It" Mentality:
It's important to reward yourself and enjoy life, but overindulging can sabotage your savings efforts. Finding a balance between spending and saving is key.
The "Ignoring the Small Stuff" Mistake:
Those daily lattes, impulse purchases, and subscription services you barely use can add up. Tracking your spending and identifying areas where you can cut back can make a big difference.
The "Lack of Financial Education" Barrier:
Many people simply don't understand the importance of saving or how to manage their finances effectively. Seeking out financial education resources can empower you to make informed decisions.
The "It's Too Late" Mindset:
It's never too late to start saving. Even if you've made mistakes in the past, you can take control of your finances and build a more secure future.
Do any of these reasons sound like you? I know many of them did for me when I was trying to get out of debt. Let's set these excuses aside and get to saving!
"People don't save money because they don't make it a priority. It's easy to spend everything you earn, but it takes discipline to set something aside for the future." – David Bach
60-Day Challenge: Build Your Emergency Fund
For the next 60 days, we are challenging you to make building your emergency fund a priority. I know this sounds aggressive and to be honest it is! But we have helped thousands of people do this very thing.
Let me tell you, when people achieve this it really lights a fire in them that says "I can do this". For many of you this will be the first time you saved a signifcant amount of money and it is going to feel amazing!
Let's go over some ideas on how many of the people we have helped have achieved this in 60 days.
Boost Your Income
- Increase Work Hours: Ask for overtime at your current job or pick up extra shifts.
- Side Hustle: Explore options like:
- Delivery services: DoorDash, Uber Eats, Grubhub
- Freelancing: Fiverr, Upwork (offer skills in writing, design, virtual assistance)
- Gig work: TaskRabbit, Handy (for errands and small tasks)
- Selling items: Declutter and sell unused items on Facebook Marketplace, Craigslist, or eBay. This is probably one of the easiest ones you can do. The average home has over 200,000 items in it, many that sit collecting dust.
Cut Expenses Ruthlessly
- Track Spending: Print out your last 3 to 6 months of statements wherever you are spending money and highlight all of your spending.
- Identify Non-Essentials: Look for areas to cut back, such as:
- Dining out: Cook at home more often.
- Entertainment: Reduce streaming subscriptions, limit outings.
- Shopping: Avoid impulse buys, shop with a list, use coupons.
- Transportation: Bike, walk, or carpool when possible.
Remember the goal is to build your emergency fund as quickly as possible so these ideas are not necessarily something you need to do long term. Think outside the box and really challenge yourself to get this quickly.
"Don't wait for a rainy day to start saving. Build your emergency fund now, so you're prepared when the storm hits." – Unknown
Are you ready to take control of your finances and build your first emergency fund?
For the next 60 days, I challenge you to prioritize your emergency fund. You can do this!
Imagine:
- Sleeping soundly, knowing a surprise expense won't derail your finances.
- Feeling calm and in control when faced with unexpected challenges.
- Replacing financial anxiety with peace of mind.
This is your chance to prove to yourself that you can do this. Let's make the next 60 days count! Are you in?
