Building an emergency savings fund is a critical step for any household, especially during an ongoing pandemic. Ensuring that you have money in the bank to cover emergency expenses can make or break your family’s economic defenses, even as we near the end of 2020.
Home equity loans, title loans, and instant savings apps can go a long way for people who are living paycheck to paycheck during a crisis.
Read on for a few key ways to add more to your savings fund, and stay prepared for a rainy day.
1. Shop Online with Savings Apps
Did you know that you can save money on every online purchase you make just by using the right apps? There are a variety of money-saving apps on the market that allow you to save by making purchases online.
Applications like Chime, Acorns, and Rakuten give you the option to round up every purchase you make online, and apply that left over money to a designated savings account automatically.
Saving small amounts passively is like filling up a digital piggy bank. Before you know it, you’ll see your balance continue to grow. If you do all your shopping online, you can increase your rate of savings any more.
Using savings apps will help you minimize buyer’s remorse knowing that you’re putting money away with every single purchase.
2. Work Remotely Part Time
If you have a few spare hours a week, you can make enough money to build a safety net. Due to the rapid wave of digitization caused by the coronavirus pandemic, companies took their storefronts and offices online. This created a boom in gig-based and part-time remote opportunities.
There are a variety of industries that are welcoming employees without any particular education or practical backgrounds. Entry-level opportunities that typically allow flexible scheduling include:
- Personal assistance
- Customer service
- Data entry
Visit your local job posting sites or popular job boards like Indeed, LinkedIn, or ZipRecruiter to see what openings are available for your personal background and schedule. Or, download app-based services like Uber, Wag, or DoorDash for the ability to work when and where you want.
3. Use Your Home’s Equity
Do you hold any equity on your home? If your home meets certain value requirements, you could be eligible to take a home equity loan against your property.
A home equity loan is a line of credit that uses the value of your home as collateral. This option is great for those with a solid credit score, and at least one residential property in their portfolio.
To find out if you can apply for a home equity loan or home equity line of credit (HELOC), contact your bank or mortgage lender to speak to a financing specialist.
4. Adjust Retirement Contributions
Investing through your company’s 401K is a sound way to build a secure financial future, especially if your employer offers a match. But, if you’re exceeding the minimum contribution and need liquid cash, adjusting your contribution amount is a fast way to add a bit more to your paycheck.
This is only suggested as a last resort for those who don’t have a security fund, or need to cover an unexpected upcoming expense.
5. Apply for Title Loans
Similar to home equity loans, 1800cartitleloan is another form of secured credit. This option uses the value of your car as collateral, so title loans are a preferred option for auto owners.
Since the loan amount is wholly dependent on the value of your collateral, title loans usually don’t require a credit or an income check to apply. Borrowers with poor credit can still be eligible for a fast, liquid cash advantage by using their pink slip.
Plus, car title loans allow the borrower to continue to drive their car. Contact your local title loan office to learn more about the options you might be eligible for.
6. Redo the Household Budget
You might already keep track of your household’s monthly income and expenses, but auditing your budget regularly can help you make the most out of every cent. Lenders, bill collectors, and even subscriptions can be adjusted on a regular basis if you use the right strategy.
The bills you pay every month can fluctuate as a result of:
- Fee changes
- Expired discounts
- Subscription renewals
- Change of ownership
Call your creditors and subscribed services every few billing cycles to ask about applicable specials, discounts, and any fees you can remove from your statement.
This is also an important method to prevent errors or fraudulent charges from eating into your budget.
7. Open a High-Yield Savings Account
Did you know that you can earn money by simply creating a savings account? If you use a high-yield bank account to store your emergency fund, you can earn anywhere from 20 to 25 times the amount you’d expect from a standard savings account.
These accounts are FDIC insured for up to $250,000 and present the lowest level of risk compared to other investment methods.
A subtle increase of just 0.1% APY can add hundreds to your emergency fund in a matter of months, and you don’t need to do anything with your money but wait for it to grow.
There’s never a bad time to make your money work for you, and generating income with a high-APY savings account is an easy, one-step solution.
8. Negotiate Better Insurance Rates
Just like you can negotiate your utilities and subscriptions, your insurance providers often provide discounts and fee forgiveness if you know what to ask for.
Many households pay multiple bills for:
- Life insurance
- Auto insurance
- Homeowners insurance
- Rental insurance
- Liability insurance
- Disaster insurance
Ensure that you aren’t overpaying to keep your family safe by calling your insurance providers a few times a year. In many cases, simply asking for a lower premium is enough to take a percentage off your payment.
Making a few changes to your monthly budget can make a huge impact on your family’s ability to build an emergency savings fund. Contacting your creditors, auditing your bill statements and applying for title loans can go a long way toward preparing for a crisis.