You might be thinking – how is it that saving up for an emergency fund will help cut my monthly costs? It’s a valid question, but saving up for emergency expenses will have a substantial impact on your long-term monthly spending.
Emergencies come up every year. Sometimes they are minor, such as a flat tire or broken microwave. Sometimes they are much larger, though, like a roof leak or move. Small or large, any financial emergency causes you to have to spend unplanned money.
And, if its money that you don’t have, then you have to find a way to pay for the emergency, and it’s usually very expensive. However, if you have the money in an emergency fund, not only do not have to pay an arm and a leg in credit card interest, but you don’t have to stress about it.
Not only does it not cause you stress, but you don’t have to deviate from your financial goals of saving and investing. This triad: not paying high-interest rates, lowering stress, and maintaining financial plans; are what makes building an emergency fund such a fantastic way to save money every month, in the long run.