Welcome back to The Daily Mastermind. My name is George Wright III. I am your host. I hope you're having a great week so far. Today I want to talk to you about creating an emergency fund. I want to give you 21 strategies that are going to help you and give you some ideas because look, building up an emergency fund, if you haven't already had one or built one, is one of the most important things you can do for your finances. And I know that you already know that. It's pretty common advice. But what's not so common is how to actually do it. And obviously, those who haven't saved up an emergency fund, and that's most people, have a difficult time saving money in the first place, even if they know that they should. So today, we're going to talk about some strategies to build up an emergency fund for those of you who really don't have such an easy time doing it, And at whatever level you're at, your emergency fund needs to change and needs to adapt. And that's why this is a critical topic for anyone, even the current market conditions and things. Now, I don't like to use the word critical very often because it's sometimes exaggerated. But in this case, we're talking about the health of your finances. And an emergency fund is definitely critical. If you're having financial problems, the most important steps you can take are to immediately reduce your spending, become more frugal, stop getting into debt, and build an emergency fund of at least $1,000 or more. And later, you can increase that. And at different levels, like I said, no matter where you're at, you may need to adjust your emergency fund. Now, it might need to be $100,000. It might need to be $10,000. But you really need to have a standard of three to six months of income set aside just so that you know that you can cover emergencies. Now, here are some reasons that I feel like it's really important to have an emergency fund, and it's critical for your financial health to do this. Number one, it'll help you to stop getting into debt because an emergency fund, you know, like when emergencies come up, if you don't have an emergency fund, the first thing you do is you jump to your credit card, right? Or you'll use credit cards to pay for the emergency and then you're deeper in the hole. An emergency fund stops the use of credit cards to pay for emergency expenses. It helps you to get out of that habit. Number two, it'll smooth out your budget. You know, if unexpected things come up, you don't want to have to continually refactor or change your budget to pay for things. So when you have an emergency fund, it makes budgeting a lot easier. The third reason is that it prevents late fees. If you're living paycheck to paycheck, which a lot of people are, and I'm telling you, even at different levels of success. People can be at paycheck to paycheck. You're going to come up with times when you have to pay a bill a little bit late or overdraw an account or something. It's a common thing for a lot of people. And with an emergency cushion, you'll avoid these financial late fees and penalties and things like that. And it's so important those things add up over time Fourth it help you to get ahead If you get a month ahead your financial stress will drop way way down And instead of playing catch up you can actually be ahead And this less stress makes a massive massive difference on your ability to create success in your life when you can limit and reduce that stress. So look, if you're having trouble saving, it's not enough to just tell you how important it is to have this fun. You need to have some strategies to do it. So let me give you 21 strategies that I believe are ideas that you can use to create an emergency fund and choose strategies, you know, choose the ones that work the best for you or maybe combine a few of them and start to implement them in your life. The first one is start small. If you don't have much to save, it doesn't matter. The important thing is that you actually start, even if it's $20 or $30. Remember, how you do anything is how you do everything and it'll slowly grow if you can create that habit. So start small. Number two, automatically deduct. This is the best advice that I've found. When you automatically deduct from your check, you don't miss it, you get used to it, and it will slowly build up over time. That's such a great way to do it. Another way I do it with some of my accounts is a few of my accounts will do automatic deductions and transfers over to other accounts like savings accounts and emergency accounts. Those automatic deductions make a lot of difference. Third, you could do a payroll deduction. If you have discipline, you know, doing it yourself, then just have it automatically be deposited out of your check. The fourth suggestion is treat it like a bill. Sometimes what you need to do is literally just budget your emergency cash into your budget. You know, every payday, you have a list of bills that you go out and you pay, add the emergency fund as one of those bills that you pay, and then you pay into a separate account. Always keep it in a separate account. A fifth suggestion I have is reduce an expense and then save it. So look at something that you have, whatever it is. If you're having trouble saving, it might be coffee, books, TV, Netflix, gadgets, whatever it is that you have. Get rid of that and use that money to go into your emergency fund. Sixth suggestion is to round up. Now I got this tip from J.D. Roth of Get Rid Slowly. Actually, it's a strategy used by his wife who logs every purchase or paycheck she writes in her checkbook. I'm not really good at that kind of a deal. But when you round up to the nearest dollar, when you spend, let's say, $26.01, you know, enter it as $27. And over the course of a month, you're going to have that buffer in your account that you weren't planning on because you're budgeting numbers that are rounded up. Does that make sense? Another suggestion is to, is like a double purpose account. This tip is from someone else that I found and he wanted to pay down his debts, but still have financial security of an emergency fund at the same time. So he used a double purpose account. He would save money in an account and after he reached a certain minimum, anything above that amount that was being saved to pay off the debt, right? Anything above that particular amount was used to pay off the debt So let say you have a minimum of After you pass the money being saved is for a debt Once you reach in that account you can pay off the $200 debt completely and then repeat it for each and every debt. So when you reduce those debts, it'll help you to be able to put money towards your emergency fund. Another thing you could do is tip yourself. When you go to restaurants and you tip a waiter 15 or 20%, match the tip for yourself. So if your tip is $10, put $10 into your savings. Tip yourself when you go out. That's kind of a random thought that you could use. Another thing is to keep paying debt, but to yourself. If you're used to paying something off like a credit card or a car payment or something like that, when you do get it paid off, continue to make that payment to yourself. You were already used to paying it in the first place. Another suggestion is budget big for groceries and then save the difference. In other words, put in your budget $400 for groceries, even if you're only spending $320. In other words, you can raise that little budget item just a little bit and then save the money that you are able to save in the difference. Now, obviously, a pretty simple, no, I'm sorry, a pretty difficult but common one that you're going to hear is quit smoking or the energy drinks or whatever it is. You know, I wouldn't bet my emergency fund on quitting one of these addictions, but if you did quit, you could take that amount that you were saving and put it into savings of an emergency fund because that stuff adds up, man. Energy drinks, smoking, I mean, we're talking a lot of money that people spend on that every single day. Another suggestion is limit your access. If you're tempted to spend your savings or it's too accessible, then the problem is that you won't be able to let that accumulate. A lot of people need the discipline of separating the accounts that they're savings into something that they can't get access to very easily. Don't have it tied to your online, your Venmo, your cash app, your PayPal account. Make it difficult to get to. And that's a big one. The 13th suggestion I have is stash a bonus or a tax refund. Every single year people get tax refunds around this country and yet they just spend it. They look at it as a bonus to go out and blow or a Christmas bonus from work or money that you get around a holiday. Use that money and put it into your emergency cash. There's a lot to be said for something that'll allow you the peace of mind in knowing you have savings. Another suggestion is save your change. Many of us do this, right? We get home at the end of the day, we empty our pockets out onto the cabinet or into a jar. Once a month, go to the bank and put that into your savings. Put that into your emergency fund. That's a great way to start stacking it up. Remember, we're trying to build habits here. We're just trying to build the discipline of creating this account. And the amount of success and accomplishment you're going to feel is going to be huge. Another thing you could do is save dollar bills. Similar to the change, maybe get your cash in 20s or 10s or 5s. But whenever you have dollars just stuff those in a jar or stuff those into something else And that help you to save Another suggestion is to refinance Refinance your mortgage or auto loan so that you can save more money but then take some money that you saving and put it into your emergency cash. Or you could sell your car. Look, if you have two cars and you don't need two cars, or you have a car that you're paying more on than you really need, reduce that expense until you get an emergency cash. See, so many people go above their means. and it's a very simple strategy for you to live below your means, but then save the difference. And once you have that, then you can upgrade. Then you can go to that next level. That's another suggestion. Another suggestion is cut out dessert. If you're trying to lose weight, don't order the dessert, right? Instead, put that amount that you would have spent in an envelope, save it, put it in the emergency fund. Another suggestion would be to stay in. Instead of going out to the movie, look, how often do you go out and spend 50 bucks at the movies, right? Or 100 bucks on dinner or 200 bucks here and there. Stay in. But when you stay in because you're not spending that money, take the money you would have spent and put it in an emergency fund. That's the discipline you've got to create. Another thing you could do is freelance. Now, this is one that I really like because people that want to learn skills or have skills on the side, one of the things they can do is become a freelancer. Get on Fiverr. Get on Upwork. Take that skill that you have and do it on the side and use that cash to put into your emergency fund. The last suggestion I have for you is you could even save on your auto insurance. If you could switch policies on auto insurance or just switch your policy to be liability only, that's the type of thing that'll help you save hundreds and hundreds of dollars on an annual basis and take that amount and put it into your emergency fund. Overall, the bottom line is this. There's a lot of suggestions, a lot of ways that I've given you here today to create an emergency fund. There's really no excuse not to have one. Let's look at this principle of financial success and realize that if you can't create the discipline to create just a little bit of emergency cash, then you're not going to have the discipline to create massive wealth. You're not going to have the discipline you need in business. You're not going to have the discipline you need in life. so take this as an opportunity to practice that discipline muscle that that consistency muscle do this and I promise you that you will have more peace of mind you'll be more effective and you'll be more productive in everything in your life I hope that's a strategy that is going to help you I hope it's something that'll inspire and motivate you to make some changes I look forward to talking with you a little bit more go check out the all the new stuff over at the daily mastermind.com and hit me up on the Daily Mastermind Facebook and Instagram. I want to hear what you're working on. I want to hear what kind of, you know, DM me and let me know what projects you're working on. There may be some things we can collaborate on. I look forward to working with you. Look forward to talking with you more tomorrow. Have an amazing day. This has been the Daily Mastermind and I will talk with you soon. Thank you.
