Everyone Has an Emergency

Okay...I know I said I would make this a weekly blog. Truth be told...it is very hard to do something once a week when your schedule is all over the place. When I do my January schedule, this will definitely be put into my schedule.

I know my last post I talked a little bit about an emergency fund, but I kind of wanted to touch a little more on it and tell you why I think it's important that you start it when you're young.

A lot of people have asked me why I have this fund. I made a jar specifically called emergency fund. It is painted red, it holds cash and my credit cards (I'm less likely to use them if they're not in my wallet) and it looks like a dangerous jar. Truth be told, it's one of my favourite jars because I know one day it'll save me and I'll be very thankful for it.

Right now I don't regularly contribute to this jar. I put in random money I find I have extra, babysitting money, or some of my birthday money (that was recent). Come January, I will be putting in $25 every two weeks. Here's why...

So I plan to move out very soon, as a lot of you know. When you move out, things like your car breaking down or your phone shattering or an unexpected trip to the dentist cost a lot more (or at lest you think they do) because you have to move money around. These are usually solved by a little rectangular piece of plastic that allow you to pay for it at the end of the month.

I do not want to rely on a credit card. I never have, I don't want to now, and I don't want to in the future. I definitely use one, absolutely. But if and when I do, it's because I have cash to pay it off right away. And I do (because now that I don't get paper statements sometimes I forget that my bill comes at the end of the month).

If you are out on your own and you lose your job, or you end up in an accident where you can't work, your landlord or bank isn't going to say "oh I'm so sorry. Don't worry about your payments until you're back at work." Life does not work that way, and I've learned from other people's mistakes that you need to be prepared.

So this is going to sound a little crazy, but part of me wishes I had started an emergency fund when I was 16. That's when I had a car and started to pay for more of my own stuff. It wouldn't have even had to have been a lot. Imagine putting away $50 a month. So from 16-23 (8 years) that emergency fund would have now had $4800. That's not a lot, but for someone on their own that could be a few months of living expenses (depending on where you're at). It seems like putting away a little bit at a time won't do much, but this year I learned that even putting $50 a week into an account adds up a lot quicker than you think.

How do you start an emergency jar? Easy.

1) Find a jar. Or a container, or something that you can close with a lid and won't be tempted to open frequently

2) If you aren't committed to putting in a set amount every week or two weeks, throw your spare change in it at the end of the week. Start with anything, make it happen.

3) If you are wanting to put a set amount, make a chart to go with it. Contribute to it weekly or biweekly and keep track of how much is going into it.

2016 is coming up! There's no better time to start than now! As always, feel free to message me with questions. I promise, I will definitely try and get back to making this a weekly thing. School is almost done so my free time will return to me :)

*I do not have professional financial training. I am simply stating from my own experience and from advice I have received from the bank, individuals, personal research, and online materials.