Imagine this: If you suddenly lost your home, your job, or were disabled with limited health or disability benefits, how would you afford a hotel, transportation or medical bills? How would you pay for all that? Benjamin Franklin once said, “A penny saved, is a penny earned”. As the nation continues to work its way out of recession, it only make sense to execute some simple ideas that will help prepare for possible disasters in the future. After all, a disaster can’t be foreseen, but it can be blunted by preparation. Here are a few ideas to save for a rainy day:
Think of taking up an emergency fund:
Unless you’re independently wealthy, it’s smart to have a dedicated emergency fund ready in case disaster strikes. This would improve financial security. Having a fixed deposit account, or a recurring deposit account also helps to save enough.
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Maintain a piggy bank and at the end of every month, deposit your monthly savings in it without fail. Also keep adding a stipulated amount at the start of every month, so you’ll have a good amount saved in case of an emergency.
Consider a second job/freelancing:
For that extra income, take up a second job like a freelance job. You can save the remunerations you get from the second job in a separate account.
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Reduce your expenses:
It’s important to be strategic in reducing you expenses. Do not over-indulge. For instance: cancel your gym membership and start running instead at a nearby park; shop reasonably and only when necessary; eat at places that suit your taste without burning a hole in your pocket. You could also opt for public transport for daily commute.
Invest in stocks or bonds:
Investing in stocks and bonds is also a sensible idea. But you must be smart while selecting the same. Pick a stock that’s reliable, relatively stable and heavy on dividend. Subsequently, you may as well invest in gold-on-paper at a fixed amount and later reimburse the same when the market for gold is in your favour.
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Loan a fair amount to a friend:
You could even loan a good amount to a friend or give it to a trustworthy person to save it for you. When disaster strikes, you can get the saving back and not worry about credit card bills.
Insure yourself well as per your needs and requirements. Learn to predict the near future so that you can be prepared for the one that’s farther. Consider a health insurance or life insurance. If you’re physically challenged then opt for disability insurance or liability insurance.