3 Reasons Why you Should Save for a Rainy Day

September 5, 2012

We all know the times in our lives when we have emergencies. Life can become extremely stressful and all that is on your mind is money and more money. Here are the top 3 reasons why you should always save money aside for an emergency:

  • You never know when it will happen: The thing about emergencies is that they are never planned. Fast cash loans online can be used by people who need an emergency shot of cash but using loans should be something that you do only when you do not have savings. Because you can never predict when an emergency will arise, you should start by saving at least 10% of your income to an emergency fund savings account. This account should never be used for your personal use or even if you just feel like it, because you never know when an emergency can come knocking!
  • It can be used to meet your expenses in case you are ill: As the old saying goes, health is wealth and this becomes reality when you are sick. No one wants to go through the financial pressure and stress involved in being ill so this is why you should start putting money aside to meet your financial expenses in case you are sick. This is especially true if you have dependents such as children or family members who rely on you in order to live.
  • Rainy day money gives you peace of mind: No one wants to go through the pain of having to ask to borrow money in case of an emergency. This is because you won’t be able to guarantee that you can pay the money back at any given time. Take away this stress by saving for an emergency.

What classifies as a financial emergency?

  • Someone passing away in your family or the death of a close friend
  • Illness or hospital bill payments
  • When insurers will not pay for an accident that was not your fault
  • Losing your job and not receiving severance

Top tip: Try and save at least 3 months worth of emergency savings