Saving For Non-Emergencies

While most people can say that they have a savings budget for emergencies, it is often the non-emergencies that push our budget to the limit. You can never predict when your car will break down, or your laptop will go on the fritz. The last thing you want to do is reach for the credit card, but you need to have a plan in place to assist in saving for non-emergencies.

Not having this kind of savings is often why many people get into debt. What you need is a non-emergency fund. This can be used for those unlikely emergencies too, but its much more likely that your brakes will need replacing before your home burns down.

The first thing to do is anticipate how much you’ve been spending on these occurrences. Look back at your financial calendar or your banking statements to determine what you’ve spent. These will be things like vacations, car repairs, birthdays, annual property taxes or insurance premiums. Anything that is not monthly counts and should be counted in this list. Now put the amount you anticipate to be spending each month for the next year.

Some will be obvious to you, birthdays come on the same day every year, others like the car repairs won’t be. But you and I both know sooner or later the washing machine will break down, so its best to over anticipate than not anticipate at all.

Include this money in your monthly spending plan. For example, if your property taxes are due in April start putting aside a small amount of money starting at least four or five months before.

So when April comes around the expense is either completely covered or very close to it. Even setting aside the price of a cup of coffee every week can greatly help in case of the unforeseeable. Think you don’t have enough money to start saving for non-emergencies? How many times did you visit the drive-through or get a massage? Even small things add up and can be used to help you save for your future.