Home » Posts tagged 'emergency savings'
Tag Archives: emergency savings
Preppers save for a rainy day: Why financial planning is crucial for surviving an economic downturn
Preppers save for a rainy day: Why financial planning is crucial for surviving an economic downturn
(Natural News) As a prepper, one of the first things that you need to learn is the importance of financial preparedness. Don’t wait until an economic collapse before you start settling your debts or saving money. (h/t to TimGamble.com)
The basics of financial preparedness
Personal, business, or government debt is bad. It will stress you out, and it makes you more vulnerable to economic downturns.
To become financially prepared, you must first eliminate consumer debt. This includes credit cards, car loans, payday loans, personal loan, and installment plans.
To clear your debts, you may need to make sacrifices, such as:
- Putting off major purchases.
- Avoiding impulse purchases (e.g. luxury items, etc).
- Bringing your own lunch to school or work.
- Having a major yard sale to raise some money.
- Starting a second job.
Making these sacrifices may seem hard, but keep in mind that in the end, the benefits will be more than worth it. (Related: 7 obvious warning signs we are heading for an economic meltdown.)
Second, you need to have emergency savings. Start by holding yard sales or getting a second job. Put the money somewhere safe, such as an insured certificate of deposit(CD). A CD is a type of federally insured savings account with a fixed interest rate and fixed date of withdrawal or maturity date. CDs don’t usually have monthly fees and they are different from traditional savings accounts in several ways. Savings accounts let you deposit and withdraw funds rather freely.
However, with a CD you agree to leave your money in the bank for a set amount of time (know as the “term length”). If you do access the money in a CD, you will need to pay a penalty. Term lengths can range from several days to a decade. The standard range of options for CDs is between three months and five years.
…click on the above link to read the rest of the article…
Without an Emergency Fund You Are One Missed Paycheck From Disaster
Without an Emergency Fund You Are One Missed Paycheck From Disaster
What would it mean to you if you had an unexpected trip to the emergency room? If your car required an expensive repair? What if your income was interrupted for a week, or two weeks, or even longer? Do you have an emergency fund built into your budget to see you through these everyday calamities, or are you only one missed paycheck from disaster?
According to a recent survey released by Bankrate, 63% of Americans do not have the emergency savings to take care of a crisis that costs $1000 or more. How do people handle unexpected expenses? According to the survey:
- 40% would use savings
- 23% would reduce other spending to cover the expense
- 15% would use credit cards
- 15% would borrow from friends or family
Many said they had no idea how they would cover an unexpected expense of this magnitude.
So what about you? Do you have an emergency fund? It’s really just one more prep that you should put aside for a rainy day.
An emergency fund is a vital prep
When your finances are tight, sometimes your first impulse is to spend every dime. Many people focus on things like paying off debts, stocking up on food and supplies, or paying more than the minimum payments on bills.
However, that may not be your best bet. Don’t get me wrong – paying off debt is absolutely vital, but most experts recommend establishing an emergency fund as the first step back to financial security. There are several reasons why this should be a priority for you:
- What if you suddenly lost your job and it was 6-8 weeks before unemployment payments began to trickle in?
- What if your child suffered a medical emergency and you needed to purchase an expensive medication?
…click on the above link to read the rest of the article…
14 Signs That Most Americans Are Flat Broke And Totally Unprepared For The Coming Economic Crisis
14 Signs That Most Americans Are Flat Broke And Totally Unprepared For The Coming Economic Crisis
When the coming economic crisis strikes, more than half the country is going to be financially wiped out within weeks. At this point, more than 60 percent of all Americans are living paycheck to paycheck, and a whopping 24 percent of the country has more credit card debt than emergency savings. One of the primary principles that any of these “financial experts” that you see on television will teach you is to have a cushion to fall back on. At the very least, you never know when unexpected expenses like major car repairs or medical bills will come along. And in the event of a major economic collapse, if you do not have any financial cushion at all you will be a sitting duck. Yes, I know that there are millions upon millions of families out there that are just trying to scrape by from month to month at this point. I hear from people that are deeply struggling in this economy all the time. So I don’t blame them for not being able to save lots of money. But if you are in a position to build up an emergency fund, you need to do so. We have been experiencing an extended period of relative economic stability, but it will not last. In fact, the time for getting prepared for the next great economic downturn is rapidly running out, and most Americans are not ready for it at all. The following are 14 signs that most Americans are flat broke and totally unprepared for the coming economic crisis…
#1 According to a survey that was just released, 24 percent of all Americans have more credit card debt than emergency savings.
#2 That same survey discovered that an additional 13 percent of all Americans do not have any credit card debt, but they do not have a single penny of emergency savings either.
#3 At this point, approximately 62 percent of all Americans are living paycheck to paycheck.
…click on the above link to read the rest of the article…
