6 Moves To Rebuild Your Emergency Fund to $10K -- Even on a Tight Budget

Key takeaway: You don’t need a big paycheck to rebuild an emergency fund. You need a system that moves money before you can spend it.

This article walks through six moves for rebuilding a $10,000 emergency fund, even when the budget is tight. Michael McAuliffe, president and founder of Family Credit Management, contributes two of them. First, he notes that most people try to save whatever is left at the end of the month, and for many households nothing is left. His better approach is to pay yourself first with an automatic transfer into a high-yield savings account every payday.

His second tip is to save the amount you choose not to spend. If you skip the coffee, the lunch out, or the impulse purchase, move that same amount into savings right then, while the good decision is fresh. The other moves in the article include setting small goals along the way, picking an end date, trimming expenses, and finding ways to earn more.

Small steps add up. If you are also carrying credit card balances and can’t tell how much to save versus pay down, our counselors can help you sort it out. Get a free online quote here.

Q: How can I build an emergency fund on a tight budget?
A: Start small, automate a transfer every payday, and put the money you skip spending straight into savings.