Money does not grow on trees and emergencies are unpredictable.
As we have seen throughout the coronavirus pandemic, financial hurdles such as layoffs or critical illness can arise with little or no warning. Building up to an emergency fund that provides at least three months of expenses during a crisis is what many Americans aim for. Reaching savings goals takes time, effort, and discipline. The peace of mind that comes with knowing you have successfully prepared ahead of time is worth every penny. When that crisis does hit, sometimes the entire emergency fund ends up spent. This can be disheartening but try not to stress. You have built up an emergency fund once and you can absolutely rebuild your savings again.
The process of savings starts with goals.
You should set goals that are achievable and fit your budget. You can either set a consistent goal amount to save each month which will stay the same over time -or- you can set structured goals where the amount you save each month is set to increase over time.
With a savings goal that stays the same each month, you can simply write out:
I will save $1200 by August 1st, 2021. I will put away $100 each month to reach my goal.
With a savings goal that increases over time, it could look like this:
You can aim to save $100 per month for 3 months, followed by $200 for 6 months, and then $300 per month for 3 months. This would give you $2,400 saved up in one year.
You can pick the method that works best for you and adjust the amounts to whatever fits your budget.
Where you put your savings is also up to you. Bridge offers a variety of savings account options. The Bridge App will make it easy to monitor your savings progress over time. Learn more about the app here.