W+M 027: Your "Oh Shit" Account (an explanation of the emergency savings) with Tess (a soloshow)
Last month we talked about the 5 steps to get started on your financial journey, and this week (and for the rest of this month) we’re diving deeper into one of those steps. I challenged you in Step 4 of the 5 steps to get to $1,000 saved up into your emergency savings account. Now, we’re going to talk about how to optimize that Emergency Savings Account by learning why it's important, how to figure out how much your savings goal should be, and how the whole "Oh Shit" account works.
Listen to the episode:
Discussed Topics:
- Why do we need an emergency savings account?
- Why did we start with $1,000 in the 5 Steps to Get Started on Your Financial Journey?
- How to calculate a reasonable goal amount for our emergency savings account.
- How to use our emergency savings account for emergency expenses.
- Deducting money and building back up to the goal amount.
- Reassessing your emergency savings account as life changes.
Resources:
- 5 Steps to Get Started on Your Financial Journey (Episode 22)
- My Budgeting and Saving Strategy (Episode 14)
- Why I Have 7 Savings Accounts
Remember: Our personal finances are just that, personal. Everyone’s needs are different, but this is a good baseline to start from. Give it a try. Test it out. If it works for you, great! If you need to adjust, do just that! If you have additional questions send me an email at TessLWicks [at] gmail [dot] com.
