COVID-19 has shown all of us the importance of an emergency fund. Most people operate on the “it probably won’t happen to me” philosophy; until it happens to them. The fact is, a major life-changing (or threatening) event can happen to anyone at any time, and pretending like it can’t is a good way to set yourself up for maximum damage when it does occur.
Many Americans have less than $1,000 in their savings account—hardly enough to subsist on should they be out of work for several months. An emergency fund should consist of about 3-6 months’ worth of expenses, or so the experts say.
Because anything can happen at any time, and you’ll still need to provide for yourself and your family.
Let’s look at a few ways you can quickly boost your emergency fund so you can reach that 6-month goal.
1. Sell A Luxury Item
The first tip is quite simple: sell something! It can be gold/diamond jewelry, a cell phone, a car you don’t use, anything you can afford to part with.
Often, we get hung up on our stuff, but at the end of the day, it’s just stuff!
You can part with just about anything and still live, but you can’t live off of no income should you be put out of work. It’s time to weigh the priorities against one another and make the right choice
Maybe you have a collection of old baseball cards worth a lot of money.
Maybe your grandfather left you some rare collectibles that you can sell for quick cash.
Or, maybe you just don’t need the newest iPhone and would rather have money in your emergency fund.
Whatever the case may be, there’s likely to be something around your house you can sell.
Most items don’t hold their value over time (like vehicles), but others increase as time goes by, and collectibles can be worth a pretty penny.
There are quite a few second-hand selling apps you can download.
2. Ditch Bad Habits Like Smoking
Vices like smoking and drinking are the bane of financial progress.
Smoking is expensive in itself, but the consequences of a daily smoking habit can be even more costly in terms of medical bills, your home and car value, and your personal effects.
Cigarette smoke damages surfaces, upholstery, and most certainly the human body.
An average pack of cigarettes is about $7 but can cost more or less, depending on your state.
Either way, at 2-3 packs per day, a heavy smoker is spending a lot of money each month that could be deposited into an emergency fund instead.
If your car breaks down, your house catches fire, or you’re suddenly out of work, cigarettes won’t keep you alive and working!
Tobaccoless alternatives are available for those looking to quit, and there’s an endless community of support available to smokers online.
With cessation apps, encouragement from those you love, the support of the non-smoking community, and tobaccoless options, you’ll be on your way to a smoke-free life in no time.
Other vices like drinking and drug use or gambling are also a good consideration.
Each of these habits has a negative effect on your life aside from the cost, making the overall impact even more impressive.
3. Do A Quick Job Or Project
Maybe you have specific skills or you’re just good at general labor; whatever the case, there’s probably a quick job in your area that you can do.
Sites like Craigslist will post “gigs”, or short-term projects you can do to earn some extra cash.
Quick jobs can also open up a world of opportunity since you’ll be meeting new people and showing off your skills.
Even if you only earn a few hundred extra dollars for the entire project, that’s a few hundred dollars you didn’t have before you started.
And, you guessed it—that money goes right into the emergency fund!
A few hundred dollars can mean the difference between missing rent, starving, or falling behind on your bills.
Remember that building up an emergency fund takes time.
You can’t (and won’t) do it overnight, unless you hit the lottery or suddenly inherit millions from a rich relative; both of which are highly unlikely.
4. Take Up A Second Job
This might seem daunting, but taking a second job doesn’t have to mean working in a factory or a fast-food establishment.
Jobs like Uber, DoorDash, GrubHub, and other ride-shares/delivery services allow you to work on your own schedule, at your own pace.
You’ll earn money while driving around during the evenings and delivering people and food.
Or, you can start a website or blog, or start making crafts. There are literally millions of different options for taking up a second job from home, but if you’re feeling stuck, here’s a list of possibilities.