Budgeting: Counting on Emergency Savings Accounts

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Do you have enough cash in the bank to cover a $400 emergency if one were to come up tomorrow? How about a $1,000 emergency? According to a recent survey, a huge number of Americans don't have the ability to handle an unexpected $1,000 expense without dipping into credit or selling possessions. Many don't think they could pay an emergency $1,000 bill at all. Does that feel like a familiar story?

Why This Topic Is Important

It doesn't have to! By taking small steps to spend less and earn more each month, you can slowly build up a savings account that can help you survive an unexpected emergency. Cars break down. Kids get hurt. Parents get sick. Furnaces and hot water heaters always seem to break at the most inconvenient time. Rather than sit back and wait for the unexpected to rear its ugly head, you are better off planning ahead.One of the first steps in building an emergency fund is taking control of your budget. If you don't know how much you spend each month and where your money goes, it's time to get budgeting! Once you have a better idea of where your money is going, it is easier to pick out specific expenses that you can cut. You might find some easy, big expenses you can cut that save you money each month. For example, if you pay $70 per month for cable but usually just watch streaming video online, you can save $840 per year cutting cable! That's enough to save a $1,000 emergency fund in 15 months.This quiz will test how well you know the best options to save, places to save, and reasons an emergency fund is a good idea. It also tests your knowledge on how you compare to your peers with some interesting statistics on the average debt in the United States today. At the end, you should have enough information to start build your emergency fund. Good luck!

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