According to this 2019 study from the American Institute of Stress, 62% of Americans feel stressed about money on a regular basis. Financial wellness should be an important part of our everyday lives.

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We’ve all experienced unexpected financial emergencies-a fender bender, an unexpected medical bill, a broken appliance, a loss of income, or even a damaged cell phone. Large or small, these unplanned expenses often feel like they hit at the worst times. 40% of American adults wouldn’t be able to cover a $400 emergency with cash, savings, or a credit card charge that they could quickly pay off, a Federal Reserve survey finds.

Setting up a dedicated savings or emergency fund is one essential way to protect yourself, and it’s one of the first steps you can take to start saving. By putting money aside-even a small amount-for these essential expenses, you’re able to recover quicker and get back on track towards reaching your larger savings goals.

The emergency fund is your safety net, in the event of a financial emergency. It gives you a buffer to keep you going till the time you figure out a more sustainable solution for the situation. A rainy day fund will empower you and grant you the freedom to make good decisions in the time of a crisis.

If you’re living paycheck to paycheck or don’t get paid the same amount each week or month, putting any money aside can feel difficult. But, even a small amount can provide some financial security. Here are some questions to ask yourself before you start building your emergency fund.

What is an emergency fund?

An emergency fund is an account set aside to gather money for emergency use. The emergency itself may be anything, but it’s wise to plan for the worst. Emergency funds are something that you can’t create overnight. It can sometimes take over a year to build a fund sufficient to meet your minimum emergency needs and years to build up a more robust amount of savings.

How Much Money Should I Have In My Emergency Fund?

As much as a necessity an emergency fund is for everyone, how much money it should have is up to each person’s needs and requirements. Most experts say to save for 3 to 6 months worth of your monthly expenses including rent, mortgage, major bills, food, etc. Do not get discouraged by this number.

If you’re in a two-income household or you’ve had a steady job for several years, then a three-month emergency fund is probably good to start out with. But if you’re a one-income family, you’re self-employed, or if your earnings come from commission, then a six-month emergency fund is probably a better idea for you since a job loss could make you unable to pay the bills. If you do lose your job, you could use the money to pay for necessities while you find a new one, or the funds could supplement your unemployment benefits.

Here are some scenarios where having more in your savings could benefit you:

• During a recession (when unemployment rates are higher and the length of unemployment is often longer)
• If you’re in a high-risk industry where layoffs are common.
• If your income isn’t steady.
• If you’re retired (and most of your money is in more-volatile stock and bond investments).

The most important thing is to start saving. The amount you need to have in an emergency savings fund depends on your situation. Think about the most common kind of unexpected expenses you’ve had in the past and how much they cost. This may help you set a goal for how much you want to have set aside. This emergency calculator from NerdWallet will help you calculate how much money you’ll need.

What if I can’t save 3 to 6 months of living expenses?

Saving three to six months of living expenses is recommended, but if expenses are tight, it may be really hard to do that, and it could take years. If you find yourself in this situation, don’t get discouraged and give up on the idea of an emergency fund. Instead, make a commitment to start small. Try setting weekly goals for yourself using this chart.

A $1,000 emergency fund will be enough to cover any unexpected financial surprises that come up. You can save $1,000 over the course of a year by putting aside just $38.50 per pay period if you’re paid biweekly.

Some experts recommend a two-step approach to your emergency fund savings. Such as having a “starter” emergency fund of $1,000 if you have debt. Then, once you’ve paid the debt off, redirect those payments to fully fund an emergency fund with three to six months’ worth of expenses.

Over time, continue making contributions to your emergency fund — as much as you can afford — and eventually you’ll reach that goal of having three to six months of living expenses saved up.

Where Do I Keep This Emergency Fund?

Where you put your emergency fund depends on your situation. You want to make sure this fund is safe, accessible, and in a place where you’re not tempted to spend it on non-emergencies. Here are a few options for where to put your emergency savings, and you can choose which one will work best for you.

You need safe, liquid options so that your money is accessible in times of need. High yield savings accounts offer excellent liquidity. You could also consider a Roth IRA. Some people also opt for checking accounts but separate your savings into a new bank account. This will allow you to look at it as a different source and not be tempted to use it for other things. Then, set up an automatic transfer of the amount that you decided upon. As long as things happen on their own, your savings will grow without much effort. Try this compounding calculator to see how much your savings could grow.

But considering that your emergency fund will be sitting idle for a long period of time, it is best to opt for an account that lets your money earn some interest and allows easy access as well. These choices make it harder for you to dip into it, and you’ll also earn a bit of return on the money. Just ensure that this interest-gaining account also allows you to withdraw from it for little to no penalty.

Now let’s look at the next steps on how to start building your Emergency Fund.

1. Set an Emergency Fund Goal

Before you do anything at all, decide how much money you want in your emergency fund, say, six months from now. Once you decide that, as mentioned above, break it down to achievable pieces. Decide on a specific number per week or month, whichever is easier for you to keep track of. Knowing your emergency fund goal will also help you decide how much spending or what expenses you need to cut down on to meet your goal.

Write your goals down. Goals that you write down are 52% more likely to be successfully achieved. Try this savings planning tool or this Emergency Fund Calculator to calculate how long it’ll take you to reach your goal, based on how much and how often you’re able to put money away.

For instance, you can set the goal to set aside $25 a week in an emergency fund. At the end of 2 years, you could have $2,600 saved. Increase that amount to $50 a week and your savings could grow to $5,200. Make it $75 a week and you’ll save $7,800.

2. Track your money

You should know your spending and earning habits well enough to decide how large of an emergency fund you’re going to need. After you know how much you should set aside every month, you need to know where to take it from. For this, you need to know what your money is doing every day. The best way to know this is by tracking your transactions, if you don’t already. It will give you a clear picture of what is standing between you and your saving goal.

3. Manage your cash flow

Your cash flow is essentially the timing of when your money is coming in (your income) and going out (your expenses and spending). If the timing is off, you can find yourself running short at the end of the week or month, but if you’re actively tracking it, you’ll start to see opportunities to adjust your spending and savings.

For example, you may be able to work with your creditors (like your landlord, utility companies, or credit card companies) to adjust the due dates for your bills, or you can use the weeks when you have more money available to move a little extra into savings. This is one important first step in managing your money, regardless of whether you’re living paycheck to paycheck or have a tendency to spend more than your monthly budget allows.

4. Find Unique Ways to Add to your Savings

It can be hard to find ways to set aside extra money, but look for ways that money could possibly be slipping through the cracks. Are there any services or expenses you could do without or cut back on?

Here are some ways to get started.

• Treat your emergency fund as a bill. Add your emergency fund to your regular bills; this will give it a sense of priority. If you need to start small, such as $10 per month, that’s still a good starting point.
• Take stock of all the goods and services that you use that are not strictly necessary, such as services you could perform yourself or spur of the moment spending choices, and put that extra money into your emergency cash.
• Put all loose change into a special jar just for your fully funded emergency fund.
• If you get a cash gift for your birthday, a holiday, or another special occasion, you can add it to your emergency fund.
• Due to their size, tax refunds are a great stack of money to add to your emergency fund.
• If you have stocks, bonds, or mutual fund s that pay regular income, you can divert that into your emergency stash for a while.
• Sell things you don’t need. If you want to get a good perspective on it then I suggest you check out Gary Vaynerchuk and his series Trash Talk. Most of us have old phones, toys, exercise equipment, electronics, etc. that you can sell and turn into cash.
• Find one time income opportunities. There are lots of chances to do some quick work and earn money inside and outside your home. You can answer online surveys, care for pets while their owners are on vacation, participate in focus groups, and more.

5. Tackling Debt While Saving for an Emergency Fund

Instead of trying to put extra money toward debt, build up your emergency fund first — and see if there are ways to reduce your interest rate while you’re doing so.

Make minimum payments on your debt whether it be your mortgage payment, student loans, or credit card debt. While you focus on building at least a starter emergency fund of several thousand dollars.

Once you have a few thousand dollars in the bank for emergencies, you can divide your extra cash between debt payments and building up the rest of your emergency fund. Or, you can shift your focus to debt repayment until you get that taken care of and then aggressively build your emergency fund up to the three to six months’ living expenses goal once the high-interest debt is gone.

You’ll have to decide which approach is best, given the interest rate on your debt and how much risk you face of experiencing a really big emergency.

An emergency fund is intended to help you stay out of debt, but what if you’re already in debt?

Deciding whether to save up an emergency fund or focus aggressively on paying down debt is difficult. Your lender likely charges a much higher interest rate than you’ll earn on your emergency fund, so it may seem silly to have money sitting in the bank while you pay interest.

However, in almost every case, it makes sense to save for an emergency fund before beginning an aggressive plan to pay down credit card debt. This never means skipping minimum payments — you always need to pay the minimums. But, unless you have very high-interest consumer debt, like payday loans or a credit card with a penalty interest rate, it makes sense to save for an emergency first.

While the math may point you in the other direction, the problem comes when that inevitable emergency strikes. If you’ve been sending all your extra cash to your credit card and your transmission breaks or you lose your job, you may find yourself charging another $2,000 on a credit card that you just paid off.

This can make you so discouraged that you stop taking steps to improve your personal finance s. You could also become trapped in the never-ending cycle of debt payoff and then ratcheting it back up when an unexpected expense arises.

6. Consider a Side Hustle 

There are only two ways in which you can increase your savings. Either by spending less or by earning more. Around 44 million Americans have a side hustle, according to a Bankrate survey, and more than a third of them make more than $500 monthly from their side gig. You could build your emergency fund quickly by working a side job for a limited period of time.

Negotiate a raise or take up side gigs, at least for a short period of time, to save up a good enough fund. If you have the time and the drive to make some side money, then this will speed up the process greatly. It can also turn into a long term hustle and a good way to make some extra money on the side long-term. There are many ways you can go about this and I would recommend getting supplemental income revolving around something you are passionate about. There is an abundance of freelance work out there for any passion. Look into websites like Fiverr, Upwork, and Freelancer if you are considering freelancing.

If you are not considering freelancing and just trying to find easy work that you can just sign up for – there is an abundance of apps out there where you can make some cash. Try apps like Doordash, Uber, and Instacart.

You also have the option of just getting another part-time job, but, that is a bigger commitment than signing up for an app or doing freelance work.

View your emergency fund like an insurance policy. Once you have it, guard it carefully. Set some guidelines for yourself on what constitutes an emergency or unplanned expense. It’s not a piggy bank. You should not use it for incidental expenses or pull from it when you want to buy something new.

Use the fund only in the event of an emergency and spend it carefully when you do need to draw on it. Remember, once that money is spent, it always takes much longer than anticipated to replace it.

Start now and save whatever you can, even if it isn’t much. However, don’t be afraid to use it if you need it. If you spend down what’s in your emergency savings, just work to build it up again. Practicing your savings skills over time will make this easier.

Looking for more financial wellness tips? Check out the Meratas blog!

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Every year, thousands of customers come together for the shopping spree that is Black Friday. If you’re not careful, it’s easy to make impulse purchases and before you know it, you’ve accumulated products that quickly become dust collectors.

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College is a great time to learn how to manage your finances and build habits that will help set the stage for financial success for the rest of your life. With more clarity on your spending and saving habits, you can work toward bigger goals, such as paying off student loan debt, traveling, and saving money for future milestones like moving to a new city after college.

While the main focus is, of course, getting a quality education, college also provides a great opportunity to develop the money skills you’ll need after you graduate. You should start making smart choices about your money now in order to set up a solid financial foundation for the future. That means building a foundation of financial literacy now.

Too many students are graduating in the red and facing difficult financial choices when they are just starting out.

If you want to get on the right track and ensure you leave college in good financial shape, read on to learn 10 money management tips for college students.

1. Set a budget

Learning how to budget and setting financial goals as a college student is important. The idea of mapping out a budget may seem overwhelming at first – Who has the energy to sit down and plan out the finer points of their financial situation after a long day of classes, exams, and other obligations? – but it can actually be fairly easy to do.

A college budget is a very powerful tool in personal finance. When you create a budget and track your spending habits you have insight into where your monthly income is going and where you need to cut back. Living on a budget doesn’t mean you can never have any fun, it means the fun you do have won’t prevent you from paying the bills.

Spend some time thinking about all of the living expenses you are responsible for each month. Start with the basic college expenses – tuition, room, and board (or rent and utilities, if you’re living off-campus), textbooks and class supplies, phone, car payments and insurance (or public transportation costs), haircuts, toiletries, and, of course, food. When you’ve made a plan for the money you have, you can rest easy knowing your priorities are covered.

Having a college student budget of your own to balance your monthly expenses and knowing how your  affect it is one of the best ways to learn good financial habits.

2. Track your expenses

The easiest way to stay on top of your finances is to track where your money is going. Regularly take a look at what you’ve been spending your money on and see where you can make cuts or spend more effectively. You might not realize how much your small, daily purchases add up to until you take a look at your income and expenses.

Creating a budget is one thing; sticking to it can be more complicated. The next step is to track your expenses through an app like Mint on your phone, or even on paper, to determine if they match with your real-world experience or require fine-tuning.

Tracking expenses by date is also key. For example, if you’ve budgeted $120 for your monthly food budget but use it up in two weeks, you know you’ll need to make adjustments.

Another reason to check on your expenses-you can catch fraudulent charges to your account early and contact your bank to reverse them.

There are a variety of budgeting apps available to help you. Just get into the habit of plugging in your daily or weekly spending to get a quick view of how you’re doing and where you may be overspending.

Check out apps like Wally, Mint, or Acorn to help you track exactly where your money is going in order to stick to your budget.

3. Open a savings account 

Lots of people struggle with this, so it’s important to start developing this habit early. It’s tempting to spend your money first and then save whatever is leftover, but you’ll end up limiting how much you save this way. Instead, pay your bills first, contribute to your savings, and then use a little on yourself.

In the words of Warren Buffet, “Do not save what is left over after spending, but spend what is left over after saving.”

Now that your budget is in place, you can identify areas where you may be able to spend less and save toward your longer-term goals. Here are a few ideas to get you started:

Consider switching to a less expensive meal plan if you find you regularly have money left in your account.

Rent or buy used textbooks instead of new editions at the bookstore. Your college may offer other less expensive options for coursework materials as well.

If you find yourself in need of new tech for class, try a refurbished, rather than brand new, model.

Consider walking, riding your bike, or taking campus transportation rather than paying to fuel, insure and park a car during your college years.

Like so many things in life, budgeting and saving are skills that take time and practice to get just right. If you find yourself making mistakes or going over budget now and then, don’t worry. You can make adjustments to get back on track. Just keep focusing on building healthy financial habits that will serve you for many years to come!

4. Start building your credit score

Your credit score will factor into everything, from renting an apartment to buying a car to purchasing your first home. There are many ways to try to build your credit.

If you have student loans or financial aid, consider making small payments of $25-50 while you’re still in school to pay down interest and have some positive repayment history on record.

The two best ways to building credit are to make payments on time and to borrow only what you need. You can also check your credit report for free at credit karma.

Learning about the factors that influence your credit report and FICO score and what you can do to improve your score are essential steps towards controlling your financial future. Also, be careful with credit card debt. Many, many college students have ruined their credit by taking easy money from credit cards and digging themselves a debt hole they can’t get out of.

That’s because using cards can be tough to navigate when you’re just starting out and you don’t want to learn about fees and interest the hard way.

One strategy some students use to build up their credit is to only use their credit card for one specific expense such as buying textbooks or gas to drive to and from school.

If you make small purchases and regularly pay the balance off in full, you’ll avoid racking up interest charges but still get that boost to your credit score.

Start by comparing credit cards and learning the different APRs, fees, and options available. Websites like The Points Guy and Consumer Reports can help recommend reputable companies.

A student credit card is a great first step in establishing a good credit history. Building good credit might not seem like a priority when you’re still in school, but you’ll need it down the road if you want to finance a car, buy a house or qualify for the best credit card offers. Your credit can even affect your job prospects and your ability to rent an apartment. Check out the best credit cards for college students here.

5. Cook on a budget

A food budget is a fact of life for adults. No matter who you are, you gotta eat and eat regularly. But there are also many different ways to go about feeding yourself and the decisions you make have a huge impact on your bottom line.

Learning how to cook on a budget is an art and a skill that you can rely on for the rest of your life. Finding out how to make foods you like to eat that don’t break the bank is a balancing act that can also be a fun experience at the same time.

If you put a few simple, delicious dinner recipes in your cooking arsenal, you’ll find it much easier to save money in the future by pulling together a low-cost meal at home instead of relying on expensive take-out or unhealthy fast food for a quick bite at the end of the day.

Check out food blogs and recipe sites like Serious Eats or Allrecipes.com to sift through recipes and watch how-to videos. You could also find some classic Julia Child videos on YouTube or turn on the Food Network.

6. Create an Emergency Fund

Having a financial safety net is an essential part of being independent. In order to prepare for emergencies and avoid unexpected debt, getting in the habit of always setting aside a part of your paycheck-10% is a good benchmark-is a mental trick that makes it easier to save.

Work on saving up an emergency fund. Whether it’s an essential car repair, a pet illness, or something more major, everyone needs a chunk of change saved up when large variable expenses arise, which they inevitably will. Depending only on credit to get you through an emergency will cost you in interest and fees.

If you’re working on paying down debt, start a small money saving account with about $1,000. Once you pay off your debt and start earning more money, you can increase your emergency fund.

One easy way to save is to have it taken out automatically. If the money remains in your checking account, it’s more tempting to spend it. When your brain is trained to expect a smaller amount in your account, you’ll automatically limit yourself to that budget.

Along the same lines, saving up for a big purchase can be a fun way to develop discipline in spending.

Need help developing the discipline? Check out an app like Good Budget or Mvelopes to help you set it aside.

7. Have a debt payoff plan

According to The Institute for College Access and Success, two out of three graduates in 2018 had student debt. Once you finish school and the grace period is up, you’ll have to start making student loan payments. It may seem jarring to go from paying nothing to paying several hundred dollars a month. If you look at your total projected debt, repayment plans, and interest, you can create a long-term debt payoff plan that puts you in a good place after you graduate.

If you did end up racking up a lot of student loans, personal loans, or credit card debt, you need a plan of attack.

There are a couple of ways you can go about paying down debt but you should ultimately pick whichever method keeps you motivated. In order to create a solid financial future, you need to attack your debt head-on as early as possible.

Making sure you have a plan of attack is crucial so make sure you have the right tools. For example, if you have a car payment and you want to know the best way to pay down debt quickly check out this car payment calculator, or if you’re trying to pay off your student loans check out this student loan calculator.

8. Start investing now

The sooner you start investing, the more time your money will have to build interest. You’ll also have to invest less money to reach your retirement goals if you start at an early age.

Investing is a lot simpler than you think. You can open an account online with a minimal amount of money and schedule withdrawals from your bank account to your investment account each month. Whether it’s opening an IRA or investing in the S&P 500 do your research before deciding on one.

9. Test out financial planning apps and resources 

There’s a lot more to managing money on your phone than just your bank’s app. Nowadays, there are a myriad of different budgeting websites like Mint and You Need A Budget that help frame your finances in ways that make it easier to save.

Try out a few and just see how they work. They may not be the ones you want to use long-term, but understanding how each app works can help you to sort through different techniques for managing your money to find the one that’s best for you.

When it comes to financial literacy, your work is never done. Like everything else in the world, the money world is ever-evolving and constantly rebranding.

The tools and knowledge you’ve developed may be enough now, but you never know what financial challenges and opportunities are on the horizon.

Find a reputable media outlet like Forbes, Bloomberg, The Balance, or The Motley Fool, whose advice you trust and follow them on social media or subscribe to their newsletters.

10. Get a part-time job

There are many advantages to working while you are in college. It looks great when you begin to apply for jobs, especially if you can find work in your field. Finding a good college job will make it easier to manage your money and gain work experience while in school. You might even benefit from tuition assistance and other employee benefits offered by your company. Plus, the more money you put toward tuition, the less you have to borrow, which will save you in the long run.

If you choose to work only during summers, make the most of your summer job. Consider picking up extra shifts in order to stash a little extra away. You might also take an internship-if it’s a paid one, you’ll combine an income with real-world experience.

You might opt to work full-time and go to school part-time to avoid going into debt. While it makes for a very full schedule, this work experience can help you as you plan your transition from school to the workplace.

Success doesn’t happen overnight, so keep working on these habits every day. As a college student, you may not have a ton of extra money now. But making smart decisions about how to pay for college could help you keep more of your hard-earned money after you graduate. If you follow these 10 tips you’ll be able to create a healthy balance and a solid financial foundation for the future.  Learn more about ways to pay for college here.

Although every effort has been made to provide complete and accurate information, Meratas Inc. makes no warranties, express or implied, or representations as to the accuracy of content contained herein. Meratas Inc. assumes no liability or responsibility for any error or omissions in the information contained herein or the operation or use of these materials. 

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Personal finance podcasts’ popularity have spiked recently. Spotify recently reported that podcast consumption has more than doubled. A number of personal finance leaders have joined the podcasting revolution in recent years, and their advice can help you establish personal finance goals in the coming year.

Whether you’re looking for advanced advice on topics like buying a home and investing, or looking for tips on how to get a jump-start on your savings, there are a variety of podcasts that can help.

If you want to get your money strategies in order in the coming year, these are the best financial podcasts to get you started.

1. Afford Anything

Afford anything, hosted by Paula Pant, interviews experts from all walks of life to help their listeners live financially independent lives. They discuss topics like should I raid my retirement to pay for school, or how to stop making money mistakes.

Her appealing and skilled interview-style attracts a wide range of guests who touch on the emotional and psychological aspects of money, but with a guilt-free and accessible tone. This podcast has a strong thread of optimism and the advice is very sound and detailed.

Her podcasts run around an hour to an hour and 15 minutes per episode.With over 240 episodes, you will find one that answers any question you may have about your finances.

Subscribe to “Afford Anything” here.

2. So Money

Hosted by leading personal finance expert Farnoosh Torabi, “So Money” has been rated as the top female-hosted podcast by Entrepreneur magazine, and it’s also the 2016 winner of the top financial podcast award from the Plutus Foundation. The podcast revolves around conversations with smart guests and practical advice on living a richer, happier life.

With over 1,000 episodes in the bank, “So Money” is a reliable and entertaining podcast powerhouse. You can learn about everything from paying off credit cards to handling finances jointly as a couple to launching and growing a business. It’s a comprehensive take on money, with no financial stone left unturned.

The podcast format is casual, yet candid, with stories and examples that are drawn from real-life experiences of Torabi and her guests. So Money is a solid choice for Millennials or anyone else who’s just getting started on their personal finance journey.

Subscribe to ‘So Money’

3. Stacking Benjamins

Stacking Benjamins aims to make finance more approachable, interesting, and fun. It’s like a personal finance variety show. They answer listener questions, do interviews, and banter about personal finance like most people do about sports.

This podcast takes place in “Joe’s mom’s basement” and is as funny as it claims to be. It’s not your usual “save money, spend less advice”, but real thoughts on money matters for everyday situations. The podcast airs weekly and tends to be 70 minutes long.

Subscribe to Stacking Benjamins here.

4. Popcorn Finance

Popcorn Finance is hosted by Chris Browning. It’s a short form podcast, discussing finance in about the time it takes to make a bag of popcorn. The show won a Plutus Award for “Best New Personal Finance Podcast.”

This is a great podcast for a short commute. The podcast covers answers to common financial freedom questions, investing and debt-free stories.

Subscribe to Popcorn Finance.

5. The Side Hustle Show

The Side Hustle Show has more episodes than there are days in the year, so finding a relevant topic won’t be hard. The podcast covers all aspects of small business including marketing, sales, websites, social media, and more. The podcast host, Nick also interviews experienced side hustle entrepreneurs.

This podcast is for anyone who dreams of escaping the rat race. Nick Loper gives practical advice on how to channel your inner entrepreneur so that one day, that side hustle will get you out of the usual 9 – 5.

Nicks’s short, punchy 30-minute episodes are actionable and inspiring. His conversations are practical, leaving the listener feeling like this whole business thing might be something they could do.

Subscribe to The Side Hustle Show

Money isn’t everything but it does still matter. In our world, not knowing how to manage your finances can be a major source of unhappiness. Hopefully, these podcasts will help you plan your specific financial approach. No matter what you want to learn about in regards to money management, with a little digging, you should be able to find a podcast that covers it.

Looking for more financial advice? Check out the Meratas blog to learn more!

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The holiday season can take a toll on your wallet. In a November 2019 Gallup poll, Americans said they expected to spend an average of $942 on holiday gifts. A record-breaking 37% of respondents said they would spend $1,000 or more.

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The college application and decision-making process can be a very exciting time, but it can also be a significant source of anxiety, especially when it comes to thinking about the overall price of college.

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This post was written by a guest contributor to the Meratas blog.

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