How to start an emergency fund
A simple guide to building a financial safety net, one step at a time.
Ever had one of those days where an unexpected bill shows up and you get that sinking feeling in your stomach? It could be a sudden car repair, a trip to the vet, or the hot water system deciding to give up. Life happens, and these moments can throw you off track.
That’s where an emergency fund comes in. Think of it as your financial safety net, there to catch you when the unexpected happens. It means you can handle those curveballs without derailing your other goals or having to rely on credit.
How much should you aim for?
You might have heard that it can be a good idea to have 2-3 months of salary in your emergency fund. If that number sounds overwhelming, you don’t have to get there overnight. Honestly, even starting with a small amount makes a real difference. The most important thing is simply getting started.
Where can you keep your emergency fund?
A high-interest savings account that doesn’t make you jump through hoops is a great home for an emergency fund. An account like the MyState Bank Hello Saver is designed for this. It keeps your emergency money separate from your everyday spending, helps it grow with a competitive interest rate, and lets you get to it when need it - no fees, no conditions.
The secret to making it happen? Set it and forget it
This is a simpleway to build up your fund: make it automatic. Take a moment to work out what you can comfortably set aside each payday, then set up a recurring transfer into your emergency fund. Whether it’s $20 or $50, every little bit adds up. When your savings happen in the background, you’re building your safety net without even having to think about it.
Keep it separate
It helps to think about your emergency fund a little differently from your other savings goals. This isn’t for holidays or a new gadget; it’s your backup plan for when things don’t go to plan. Having a separate account makes it easier to leave it alone until you truly need it.
Watch it grow and feel good about it
Every now and then, take a peek at your progress. Seeing that balance grow is a great feeling and can keep you motivated. If your circumstances change, you can always adjust your contributions. Our budget planner can help you figure out what works for you.
Building an emergency fund is a journey, not a race. It’s one of the kindest and most practical things you can do for your future self. Start small, automate what you can, and enjoy the peace of mind that comes with watching your safety net grow.
