It’s relatively easy to plan for expenses like sending your teen to college or future family vacations, but some situations arise without warning. For example, your child might end up with an injury that isn’t covered by insurance, your furnace might break down on a cold winter’s day or you might even lose your job.
To avoid financial hardships on top of unexpected repairs and other needs, it’s best to have an emergency fund. Think of this money more as a safety net than a bank account.
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It’s recommended by many financial experts that you have an emergency fund that covers three to six months’ worth of living expenses should you suffer a financial shock like job loss, car repairs or medical bills. This cushion can help protect you from having to take out a loan or borrow from your retirement fund.
One of the best financial decisions you can make is to plan for the unexpected. Though it may seem counterintuitive, having a separate account or savings for nothing specific is actually a savvy money move. Check out the following unexpected ways to start saving and padding your emergency fund.
Use Loyalty Programs to Your Advantage
Many of your favorite retailers have rewards programs for shoppers who often buy their products or services. If you’re not already enrolled, now is a good time to get in on the action.
By joining loyalty or points programs for retailers you already frequent you can get a variety of curated special offers. Take any money you save on your monthly shopping budget and put it directly into your emergency savings account.
Switch To an Interest-Earning Checking Account
Trading in your traditional account for a checking account that earns interest is an easy way to raise money for your emergency fund. To get the highest return possible on your money, it is best practice to shop around for a checking account that earns high dividends and meets all your needs.
Opening a high-interest savings account can also help to put money aside for your emergency. These accounts are a safe, member-FDIC place to keep your money where you won’t be tempted to spend it.
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Cancel Your Cable Subscription
Chances are you probably don’t watch most of the channels that come with your cable subscription, so get rid of it to boost your emergency cash. You can then start small by replacing cable with just a few streaming services, as there’s no need to go overboard in that direction either.
Canceling your cable can save you $50 to $100 each month, which is a lot of extra cash you can stash in an FDIC-insured emergency savings account.
Earn Some Extra Income
If you’re committed to building your emergency savings fund, you won’t mind dedicating some time to earning extra cash. Whether you sell things online or work as a delivery driver, you can use all of your side gig money to build your savings and use your regular paycheck to cover the rest of your expenses.
Sell Unwanted Items
Fill your emergency fund with cash by purging your home of clutter. Cleaning house regularly is a great way to stay organized — and you can simultaneously earn extra money by posting the stuff you don’t want or use anymore for sale online.
Stick To Your Grocery List
Heading to the store without a clear plan in mind is an easy way to ensure overspending. Instead of impulse buying, make sure you stick to your list and don’t deviate so you don’t go over budget every time you grocery shop.
Create a Meal Plan Based on Weekly Sales
Some unplanned expenses could be part of a bigger financial picture. For example, though you should always try to stick to your budget and grocery list, if you do step outside the lines you should do so for sales. You can meal-plan based on weekly ads and discounts your local market is offering. These substitutions are OK if they save money and leave you with more cash for your emergency fund.
Redeem Credit Card Rewards for Cash
If you’re like many people, accruing credit card rewards is one of the main reasons you pay with plastic. But instead of mindlessly spending your points, try to work them into your emergency savings plan.
Visit the rewards website to find out if you can convert the rewards into cash or gift cards, which can put the money in your pocket instead of just readying it for future spending.
Negotiate Your Monthly Bills
No one likes paying bills, but it’s even worse overpaying for bills. There are ways you can negotiate your monthly cable, credit card or utility bills down instead of allowing whatever the company charges you to be automatically taken from your account each month. Whether you hire professionals to reduce your bills or negotiate yourself, you could add some serious cash to your rainy day fund.
Invest in a Mutual Fund
Saving for emergencies by investing in a mutual fund is easier when the money is automatically taken out of your account. You need emergency savings to be liquid, but mutual funds have a money market account.
Simply set up a debit from your checking account on a desired date of the month to be automatically deducted, and it will transfer right into the money market account for your emergency fund. Before long, you won’t even notice the money is gone — and your emergency fund will be flush.
Treat Your Emergency Savings as a Bill
When it comes to financial planning, it’s a lot easier to part with the money you put in savings when you take on the mindset that it’s just another bill. Instead of looking at saving as an optional move, think of it as a mandatory expense like paying rent or your phone bill. That way when unexpected expenses arise, you already have it covered.
Cancel Your Gym Membership
Swapping the expensive gym treadmill for an outdoor run will allow you to explore your local community while still getting your exercise in. There are also plenty of free, at-home workouts available these days.
Pause on Overpaying Your Student Loans
Getting out of debt and being done with your college loan sounds like a great financial plan, but you may not be getting the best interest rates available on old government loans. By simply paying only the required amount, any extra money you shave off each month can be put in an emergency savings and earn interest instead.
Then, after building up a solid emergency savings fund, go back to paying off your federal student loans if it makes sense for your current financial situation. Wanting to live debt-free is admirable, but establishing a comfortable emergency fund first is important.
Grow Your Own Produce
Grocery shopping is an expensive, yet essential task. Fortunately, there are ways to ease the burden — including growing your own fruits and veggies.
Food costs are at an all-time high so cutting back on your grocery bill will go a long way to help form healthier spending and saving habits.
Take Advantage of Happy Hour Specials
If you must go out to eat or meet friends for drinks, schedule your outing during happy hour. Typically held between the hours of 4 p.m. and 7 p.m., happy hours regularly feature deep discounts on food and drinks.
You can get the same menu items people will pay full price for later in the evening, at a fraction of the cost. Calculate the amount you saved by going out early and deposit this sum in your emergency fund.
Stick With Standard Shipping
The tax you pay on instant gratification may be adding up more than you think. If you opt to wait longer you will be spending less on your online purchases overall. So, as long as you plan ahead, you can still get what you need without paying extra.
Switch to Generic
Buying generic or store-brand items may only shave off a few cents here and there, but that adds up to a lot of saved money per month. Add up all the money you save on each shopping trip by opting for generic products and deposit it into your emergency fund.
Get New Quotes for Your Home and Auto Insurance
If you’ve had the same insurance policies for a while, it’s definitely worth seeing if you can score a better rate with your existing provider or a competitor of equal stature. Many financial advisors recommend you get new quotes on your home or car every three years.
Buy Used and Save the Difference
Whether you’re in the market for a living room set or a winter jacket, you can save by visiting thrift and discount stores.
In addition to thrift shops, there are organizations like Habitat for Humanity that have opened up store locations they call “re-stores.” These facilities sell everything you could want for your home in excellent condition at a fraction of the price. If a new chair was going to cost you $500, but you got it for $150 at a re-store, you’d be able to put $350 of emergency money away.
Make Use of Your Local Library
There’s no need to spend a ton of money on books when your local library will allow you to borrow the books, either in-person or online, for free. Many libraries even take requests should there be a particular book you have an interest in that isn’t currently found on the shelves.
Check with your local branch for extra freebies, like movie rentals, cooking classes and special events for kids.
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This article originally appeared on GOBankingRates.com: 20 Unexpected Savings Strategies for Building an Emergency Fund
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