One of the pillars of financial health is savings. Most financial experts preach having three to six months of expenses in your bank account. When you are in debt and scrambling to pay all of your bills each month, saving anything seems impossible. The first step in savings is accumulating a $1,000 emergency fund.
Money on reserve means you are prepared for lifes unexpected moments and can address them without using credit. Makes perfect sense.
So. How does one on a shoestring budget save $1,000? I am still answering that question. But, here is what I have learned so far.
1. You have to make a budget and stick to it. Period.
2. Sell things you do not need. EBay is our favorite place to make some extra money with little effort. Clothes, cell phones, electronics and collectibles have all brought us success.
3. Review your cable and cell phone packages. If you can cut out the cable package all together, good for you and do it! There are so many cheap streaming options and Smart TVs have the apps built right in (no more streaming through your Wii). Hulu even streams current season TV shows from most of the major networks so you arent really missing out on most of Prime Time. We made the switch to streaming for a short time. But ultimately went back to satellite. I have not yet conquered the cell phone package. All I know is we pay way too much. (Advice is welcome!)
4. Get creative. We came up with other creative ways to assure we are stashing away as much as we can. Because a chunk of our income is in cash (my husband brings home cash tips), we budget for the minimum we know he will make each week. Anything above that is automatically put in savings. So, if my husband makes $100 in tips, $40 of that will go straight to savings. We dont miss the money because we never had it in our budget.