Strategies For Starting a Rainy-Day Fund

When you’ve got a family and the cost of living is rising and rising, it can feel like often there isn’t anything left each month to save. But saving for a rainy day, as corny as it may sound, is something that is really important for everyone. There can be plenty of unexpected circumstances that occur, and being able to afford the things that you may need but not expect to have to pay for right then, can make a massive difference to your finances.

In some cases, getting a cash loan today could work for you if you are budgeting and know that you have money coming in to cover it. But if that isn’t the case, then having some savings is the way to help you stay in control. So here are some ways that you can start a rainy day fund, even if you don’t think that you have got too much extra to save.


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Understand Purpose of Rainy Day Fund
When you know what you are saving for things, it can make it simpler and easier to save for things. For example, this isn’t a fund for vacations or new clothes (unless you want it to be), and is more about a fund for the things that are unexpected or unanticipated. For instance, if you drive a car you know there will be repair costs from time to time. But you might not expect to have to repair two tires at the same time, because they both got a nail stuck in them. Up front that can be quite a large cost that you won’t have been expecting.

Choose a Way To Save
Having a piggy-bank can be a way to save money when we are children, but what about now? Having cash sat at home can be a way to do it, but there are much smarter ways, where your money can do more for you and earn while it is just sat there. But which method will you choose? You could use an ISA, but that could be better if you will have larger amounts to pay in at once (and there can be restrictions on taking money out). At least starting with a savings account is a good way to go; just make sure that you are looking out for one that gives you a great interest rate (and one that doesn’t have a fee).

Make a Plan
Making a plan and being honest with yourself is one of the best things that you can do when it comes to saving. Because if you are really serious about doing it, you will find a way to do it. So make a plan of how much you want to save each week or each month, and then look at your finances to see what you will have to do to make it happen. It may mean cutting a few things out here and there, but it can be a big benefit to you as time goes on.
 
Bank Extra Income
If you are due to get a bonus or something like that, then it is a good idea to bank that as soon as it comes in. It can be so very tempting to spend it, but if you want to make some serious savings towards a rainy day fund, then that is going to help. Plus, when the money is out of sight, it is out of mind. So you won’t be getting tempted to spend it. You could also look for a way to generate a second income, and use that money for savings only (though with a family that could be a large ask as it means more to juggle and organize).

Have Separate Accounts
On a similar note, with the same ‘out of sight and out of mind’ attitude, it helps if you are able to have separate accounts to move money over too. As mentioned above, if you have got a savings account to send the money to, then it can make your money do more for you, just for it being sat there. And if you move the money to an account that is harder to access (so there isn’t a bank card relating to it, for instance), then it makes it much less tempting to spend it. Meaning that the savings can just go up and up.

When you put your mind to it, you can be surprised at just how much you will be able to save. But it starts with that first decision to make it happen.