How to Set Up a Starter Emergency Fund

Kevin Payne

February 5, 2018

Emergency Funds are vital to successful family financial planning. While it’s good to research and put thought into how much money you need to set aside, you need to get a starter emergency fund right now. $1,000 is a good sized starter fund that isn’t too difficult to reach, even if you are dealing with paying off debt. Here’s how:

Open a Separate Account for your Emergency Fund

You want your emergency fund to be accessible 24/7, but you also want it to not be so convenient that you are tempted to pull from it for reasons that aren’t truly emergencies. Opening an online savings account is a good option that covers both ideas.


Find Ways to Fund your Emergency Fund

People often wonder where they are going to get extra money to set aside for an emergency fund. If you are serious about being prepared, you will find ways.

Cut Spending; Skip the coffee in the way in to work tomorrow and brew some at home instead. Pack lunches instead of eating out. Institute a spending freeze in your house except for necessary items.

Get a Job: Get a second job or start a side hustle that will provide enough money to get your fund going. You don’t have to work two jobs long term, just long enough to fund your emergency account.

Sell: Find stuff to sell around the house that you no longer use that other people might want.

Tax Refund: Set aside part of your next tax return to build your starter fund.

Photo by Craig Whitehead on Unsplash

Create an Emergency Fund Plan

Now that your starter fund is complete, determine how much money you need to keep in order to provide your family with piece of mind. Often 3 months of salary is sufficient if you have a stable job situation and don’t have debt. Many people would rather save it 6 to 12 months worth of salary. It’s up to you. Will you feel more secure with 6 months worth of salary saved up? Is 3 months enough.


Note: If you are struggling with debt, I urge you to create your starter emergency fund and then focus your financial efforts on clearing your debt as fast as you can. Then you can go back to building a bigger fund later.


Rainy days will come. They always do. Advance preparation can help save the day when it starts to pour.

What are you doing to contribute to your Emergency Fund? Let us know in the comments below!

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How to Set Up a Starter Emergency Fund