Apr 07, 2023 / Money Tips
April showers might bring spring flowers, but in Utah, we can’t seem to get enough of the greatest snow on earth. While we’re waiting for spring to finally spring and the rain to replace the snow, now seems like a good time to talk about saving money for the unexpected storms of life. It’s always a good idea to have a personal or family emergency fund for unanticipated expenses, including car repairs, medical expenses, or say, property repairs from a record-setting snow year. In the spirit of Utah spring, here are five quick tips to save for a snowy day fund.
You should try to save at least three-to-six months’ worth of expenses in your snowy day account. That doesn’t necessarily mean saving for everything you want to buy within the next half year, vacations included. Focus on the necessities of life and save enough to cover food, housing, transportation, and other essentials. If you’re just starting out, try putting away $500—enough to cover a big bill—and keep saving from there.
A money market account is the perfect place to keep emergency money. You’ll always have access to your funds, so you can make quick cash withdrawals in an emergency. It’s separate from your everyday savings and checking account, so you won’t be tempted to use funds for non-emergency situations. And, you’ll earn more interest, so you can build up your snowy-day fund during times of clear skies and sunshine.
Building up your snowy day fund is always harder at the end of the month. If you have enough money left over after all your bills have been paid, you could put cash in your emergency account … or you could always start next month. Instead of facing this dilemma, end of month after end of month, save for your snowy day fund first. Use direct deposit to transfer money from your paycheck into your money market account. At Utah First, it’s easy to set up and make changes to your direct deposit accounts—and you can do it all from the convenience of your home computer or mobile phone in just minutes.
You never know when one of life’s unexpected storms might strike (you live in Utah, after all). Ideally, you should always have a snowy day fund ready, just in case. If you’ve recently used some or all of your emergency funds, do your best to build it back up and stick to your savings schedule. Again, start with small contributions and be consistent. If you already have six months of expenses saved, there’s no harm in adding to your emergency account, or you can always open a longer-term account or start saving for something more fun.
If you’re expecting a tax refund this April, consider jumpstarting your snowy day fund with cashflow the comes outside your ordinary income. Starting an emergency fund all at once can give you some extra financial peace of mind, and you won’t have to worry about building up your account before the next emergency happens.
If April snow has you thinking about life’s unexpected storms, take advantage of the extra inside time to think about your emergency savings fund. At Utah First, we’re always here, snow or shine, to help you open a money market account, show you how to make adjustments to your direct deposits, and offer friendly financial advice for your unique financial situation. Give us a call or stop by a branch to open your snowy day fund today.