Everyone knows the cliché about saving money for a rainy day. This old saying is timeless, as it simply illustrates how vital it is to have money saved up for emergency scenarios. The problem is that we all tend to think it will be sunny all the time; we don’t really think emergencies are going to happen. This is frustrating, as we have all dealt with dire financial situations at one time or another. It’s just too easy to think that there will be no bumps in the road.
We like to look on the bright side of life too. Every once in a while, though, you have to be honest and start planning your finances to deal with emergencies. If you have not yet started an emergency savings fund, think about these scenarios, how common they are and maybe you will get inspired to start saving for life’s little emergencies before they happen.
Getting Your Identity Stolen
Identity theft is horrible to deal with. And unfortunately, it is becoming all too common these days. If your identity gets stolen, it can cause you serious problems for years to come. You can freeze your credit report, report the situation to authorities and take other actions, but you may find that you need some emergency cash to help you through the early stages of recovering from identity theft. Unless you have a sizable chunk of cash set aside, you may find that the common occurrence of having your identity stolen will stop you dead in your tracks with regards to your financial life.
Most people try to live healthy lives these days. Medical emergencies, however, can happen to even the healthiest people in the world. And it may not be you who has the medical problem, it may be a loved one that you have to help out. You probably already know this, but even with good insurance paying for medical care is absolutely expensive. Just having a bit of emergency cash can help to alleviate the stress that comes with a medical crisis, and may help you to get through the situation without going into more medical debt than you might think.
Unstable Job Situation
Unemployment numbers have been leveling off in recent months. Still, though, being employed these days is not like it was a few decades ago. These days, you can’t rely on the fact that you’ll be working at the same job in 20 years. Companies downsize, change ownership or seemingly randomly decide to let valuable employees go. In other words, you may find yourself out of work at some point in time. If that happens, you’ll appreciate having some money saved up to help you get by. Even having an emergency fund that can keep you going for a month or two can be a huge security blanket when a bad employment situation occurs. But even if you love your job and work for the most secure company in the world, it’s still wise to save money regularly.
There are other situations that can occur, like natural disasters, being the victim of crime or even just investment mistakes that can cause you very real financial problems. It is always best to have a financial “umbrella” that can provide you a little bit of stability and protection during those times. No one should walk around always thinking about the worst things that can happen. But it is important to be a realist at times. And reality dictates that bad things can happen to even the best of us. It is best to have an emergency savings fund in place to help you move forward through the storms that inevitably affect us all.