New data shows half of us are regularly tapping into our emergency savings for non-essential expenses like holidays or nights out.
If that’s you… it’s time to put the brakes on and start refilling the coffers.
Here are five ways to rebuild your emergency fund:
1. Use unexpected windfalls
Have a plan to make sure it all goes straight into the fund. Everything from tax refunds and wages rises to work bonuses and birthday money.
2. Set up an automatic debit on pay day
Organise for a fixed amount to be automatically transferred each month. It eventually becomes one of those unseen transactions which doesn’t even register so you don’t miss it.
3. Target a luxury you can do without
Some estimates indicate each household wastes at least 10% of its income each month on things it doesn’t need.
4. Pad your account with dividend earnings
Build a share portfolio of good dividend stocks and deposit those dividends in your emergency fund.
5. Collect spare change
Have everyone in your family empty the change from their pockets at the end of each day. At the end of the month, deposit it all and watch it grow.