photo by jswieringa

If there isn’t money enough to go around, starting an emergency fund seems impossible. If an emergency happens, like a car breaking down, people pop the repair bill on their credit card. When life’s emergencies continue to happen, the debt increases and this cycle becomes a financial mess.

You need money that is easily accessible in case of an emergency. Make it a priority. Calculate your expenses, try to reduce some and see what is left over from your income. Afterward, start tracking your spending so you can account for every penny, and start saving even a small amount today. You can’t afford not to. Here’s how.

START A CHANGE JAR: It seems spare change can’t possibly add up, but it will. Simply stop spending your loose change.

GIVE UP SOMETHING: Once you’ve tracked your spending, you’ll see your money leaks. Patch the leak by making new decisions. Maybe it’s a daily pack of gum, lunch out or a drink from the vending machine. Save what you would have spent. Don’t forget that it’s not actually saving money unless you take that money, set it aside and don’t spend it.

TREAT IT AS A BILL: You can have money deducted automatically and transferred to a separate account. Start out saving a small amount that you won’t miss. You will be paying yourself first. You can open an online savings account at Direct (www.ingdirect.com) or Emigrant (www.emigrant.com).

POCKET THE DIFFERENCE: If your electric bill is less than you budget for, take the difference and save it. You can shop around for cheaper car and home insurance and phone service and do the same.

KEEP IT FOR YOURSELF: If you’ve paid off a debt like a credit card or loan, don’t increase your spending. Take that money and put it into your savings.

QUIT THE BAD HABITS: No more excuses if you have a bad habit like smoking or drinking. Quitting might be easier said than done, so at least cut back and save the extra cash.

MAKE EXTRA MONEY: Something as simple as having a garage sale or selling an item on eBay (www.ebay.com) can kick-start your savings. If you’re serious about having a safety cushion, consider a part-time job.

SAVE YOUR REFUND: If you receive a tax refund, use some or all of it to fund your emergency account. Take a look at your withholdings and see whether you can keep more money for yourself each month.

BANK YOUR BONUS: If you receive a bonus, raise or money gifts, save the difference.

ROUND UP: Get cash back from your debit card at store checkouts.

MAKE SUBSTITUTIONS: Look for lower-cost alternatives. If you’re used to buying snacks, try homemade, dine at home instead of going out, shop store brands versus name brands or cut your gym membership and work out from home. Make the best use of your options and get into the habit of looking for creative ways to save your money.

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