Saving for Unexpected Emergencies Helps Prevent Financial Disaster
Riverside, CA – August 31, 2011 – In observance of National Preparedness Month, Springboard Nonprofit Consumer Credit Management is encouraging consumers to assess their financial situation and start saving now for unexpected emergencies. National Preparedness Month is a month-long awareness and activism campaign occurring every September to improve the preparedness of our nation. During the month of September, individuals, families, businesses, and organizations are encouraged to take the necessary steps to ensure that their homes, workplaces and communities are prepared for disasters and emergencies of all kinds. In response, Springboard is inspiring individuals and families to also take meaningful action towards financial readiness as part of their overall emergency plan.
“It’s not a matter of if the unplanned expense will occur, but when,” says Melinda Opperman, Springboard’s senior vice president of community outreach and industry relations. “Sadly, many individuals and families don’t have an emergency savings fund to fall back on in case of a financial disaster,” says Opperman.
Consumers should ask themselves how they paid for their last emergency. If it was with a credit card, that’s a red flag. Your credit card isn’t an emergency fund. Springboard encourages consumers to begin putting at least 10 percent of each paycheck into a savings account. If you can’t do that try a more short-term goal of saving $500. After a month or two of bringing your lunch and snacks to work, not dining out and avoid shopping for 30 – 60 days, you may find you can make a great amount of progress toward your $500 goal. Have the designated amount automatically deposited into your savings account. You can’t spend what you don’t have, so remove temptation by deducting the money before you receive it. Any windfall of money such as a tax refund or unexpected financial gift should be put into a savings account too. A hardship savings fund consists of at least six months of savings and should only be used in case of a job loss or illness.
“Oftentimes, the hardest part of establishing an emergency savings plan is simply getting started,” says Opperman. “Life can be full of surprises—some happy, some not, and when the unexpected expense occurs, you’ll be glad you had a rainy day fund to fall back on. The emergency may be less of an emergency simply by having a savings plan,” says Opperman.
Across the nation, Springboard assists individuals and families with personal financial education and assistance with credit counseling, housing counseling, debt and money management through educational programs and confidential counseling. The following cost-cutting tips can help consumers save hundreds of dollars each month that can be put towards an emergency savings fund:
- Stop carrying credit cards. Pay in cash. Bring only enough cash for things on your list.
- When buying groceries, prepare a list and stick to it. Avoid impulse buys, even with sale items.
- Clip coupons from newspapers or find them online at sites like SmartSource.com, WowCoupons.com, CoolSavings.com orCouponMom.com
- Shop once a week. Buy store brands – they are often of comparable quality to national brands, and prices are much lower.
- Make sure your items ring up correctly at the check stand.
- Stay away from restaurants. We spend 15% of our income on food. More than a third of that amount is spent in restaurants, snack bars, and on fast food.
- Eat at home or bring a homemade lunch to work or school.
- Stay away from malls. Malls are budget busters. It’s too easy to spend money on impulse when browsing at the mall.
- Turn off lights and the TV when not in use. Run the dishwasher, clothes washer and dryer with full loads. Set the thermostat at 68 degrees in the winter. Use the same brands of toothpaste, shampoo, soaps and razors, etc. and buy in bulk.
- Buy at discount shopping clubs; buy in bulk and only items that you will use and that will keep.
Springboard’s certified financial counselors are available Monday through Friday from 8:00 a.m. to 8:00 p.m. and Saturday 9:00 a.m. to 6:00 p.m. Pacific Standard Time to offer helpful tips on establishing a financial readiness plan. In addition, visit Springboard’s personal finance blog – http://credit.org/blog/category/money/saving-money/ – for helpful money saving tips.
About Springboard Nonprofit Consumer Credit Management
SPRINGBOARD® Nonprofit Consumer Credit Management is a 501(c)(3) nonprofit personal financial education and counseling organization founded in 1974. Springboard is a HUD-approved housing counseling agency and a member of the National Foundation for Credit Counseling, a national organization of nonprofit credit counseling agencies, and a member of the Association of Independent Credit Counseling Agencies. The agency offers personal financial education and assistance with credit counseling, housing counseling, debt and money management through educational programs and confidential counseling. Springboard is accredited by the Council on Accreditation, signifying the highest standards for agency governance, fiscal integrity, counselor certification and service delivery policies. The agency provides pre-bankruptcy counseling and debtor education as mandated by the bankruptcy reform law. The agency offers nationwide phone counseling services and has locations in California, Arizona, Nevada, New Mexico and Texas for in-person counseling sessions. Not all types of counseling are available in-person at all locations, please call for details. For more information on Springboard, call 800-449-9818 or visit their web site at www.credit.org.