This post is brought to you by The Huntington National Bank and The Motherhood. All opinions are my own.
I’ve pretty much always had a savings account, ever since I opened my first little kid’s savings account many years ago. But it wasn’t until about ten years ago that I actually intentionally began saving, including saving for an emergency.
Prior to becoming intentional about saving, I always just made sure my savings account had some money in it. I preferred to see the number go up, but if I felt like I couldn’t add money to the account each month I didn’t sweat it. But like a lot of Americans, I also didn’t make a point to add a certain amount each month or add a savings line item to my budget.
Saving for an Emergency
When my husband and I got married we had to get on the same page with a lot of things, including money. We talked about finances before marriage but it wasn’t until after we said “I do” that we started to combine accounts, close old accounts and really discuss what our financial goals were.
As a 2019 Huntington Bank Influencer Ambassador I am sharing my personal banking experiences and talking about finances. Additionally, I am sharing some of the key service offerings of Huntington Bank, along with their banking products, events and initiatives. Huntington Bank is a full-service banking provider.
What is an Emergency Fund?
My husband and I decided one of our goals would be to have an emergency fund. Saving for a financial emergency is important because there are a lot of possible life events that can happen at any time that cost money. Examples of why someone would want to be saving for an emergency situation include: loss of a job, unplanned medical bills, a natural emergency such as a house fire, a car crash totaling your car and more.
How Much Emergency Fund Should I Have?
Most people consider having about $1,000 in savings to be at least a small emergency fund. I think this amount is a great goal to start with, especially if you are not used to saving or have never had an emergency savings account before. However, a wise long-term goal is to save enough money to cover your living expenses for an extended period of time.
Emergency Fund Size
This typically means enough money to pay your bills, rent or mortgage, food and other needs during a loss of income. The amount will depend on your personal financial situation, your income, your expenses and family size. Usually people try to save three to six months worth of living expenses.
Why Should You Have an Emergency Fund?
Just in the last three years we’ve each dealt with a strange occurrence – my husband in 2016, then our daughter in 2018 and, then myself, also in 2018 – each being admitted to the emergency room for various ailments. It was the first time for each of us to be admitted! For my husband and I, we each ended up taking ambulance rides which added additional exorbitant costs to our medical bills.
Without having an emergency fund these unexpected medical bills could have really added tremendous stress to our financial situation. Instead, they added annoyance more than anything. I would have loved to have spent that money on a vacation, but by having an emergency fund to pull from, we avoided so many possible financial stresses.
Saving for an Emergency Fund
If you are new to building an emergency fund it can be overwhelming. I remember really scrimping and saving and living on a tight budget in order to meet our first emergency fund goal. Over the years our emergency fund has changed, we have moved to a more expensive city, moved into a home, had a child and brought a dog under our roof.
On top of that the cost of living continually increases. Because of this it’s important to revisit your emergency fund “desired amount” on a regular basis to make sure it still meets your current needs. When you are just starting saving for an emergency it may be hard to imagine saving the total amount you desire, or even that initial $1,000.
Saving More When Money is Tight
My advice is to start small, take it one day at a time, remain focused and celebrate the wins. A win might be saving $10 by using coupons when grocery shopping or tossing any spare change you have into a jar intended for savings. Other ideas to save for an emergency fund, even when money is tight, include:
• Decide today what is considered a real emergency. Car repairs? Medical bills? Broken furnace? This will help you stay on track with your goals when the unexpected happens.
• If you do need to dip into your emergency savings, commit to replenishing that money ASAP after you recover from the unexpected event so that you can keep your financial commitments.
• Open a dedicated account for your emergency fund. This will help set clear boundaries for where to put emergency fund, where your money is going and to help eliminate temptation to spend.
• Consider arranging an automatic contribution to your savings account to help you save without “thinking” each week and month. Once the money is moved to savings you might not even realize it was there!
Huntington Bank Offers Savings Tools
In addition to using these tactics, Huntington Bank offers a set of tools to help you save for a goal or emergency fund with greater ease. These tools include Savings Goal GetterSM on The Hub. Huntington Bank customers who have a savings account or money market account can access these tools. The Savings Goal Getter tool gives you the option to set up 10 goals and an emergency fund per account.
These savings goals can include an emergency savings fund and/or other goals such as saving for a vacation, a home project, retirement or college fund. The Savings Goal Getter is a tool within The Hub, which is Huntington Bank’s new digital banking experience. The Hub is designed to help look out for you and your financial future.
Emergency Fund Savings
The Savings Goal Getter helps you visualize what you are saving for and helps you see your progress every step of the way. You can set the amount you want to save and the date you would like to reach your goal by. For example, if you want to save $1,000 by December 31, the Savings Goal Getter will then allocate the money in your savings/ money market account within the tool to show where you are in reaching your goal(s)!
While you can set up to 10 goals with this tool, one thing I think that is really intuitive is the tool will prioritize saving for an emergency fund first. While it’s fun to save for vacation or a new car, having that emergency fund in place first is paramount to financial fitness.
Huntington Savings Goal Getter
I also like the visual aspect of the tool. I’ve found it difficult in the past to save for multiple goals from one account. How much money was in my emergency fund? How much money was being saved for our new roof? What about our vacation? The Savings Goal Getter tool makes all of that clear. As you add money to your savings account the tool will then fund the goals you have pre-set.
Lastly, if you use Huntington Savings Goal Getter to help save for an emergency fund, the tool offers an emergency fund calculator to help you determine the size of your emergency savings fund and will make recommendations based on how much you opt to save. Your goals can be edited at any time and you can also set up notifications (message and data rates may apply) to let you know if you are behind schedule on your savings goal.
Getting Started with Savings Goal Getter
Through my relationship with Huntington Bank, I want to share a simple four-step method on how to use the Savings Goal Getter tool on your own. Simply follow these steps to create your first goal:
• Step 1: Log into The Hub on your desktop or phone. Within The Hub, scroll down to the Savings Goal Getter header. Select “Get Started.”
• Step 2: Decide your goal type and general outcome. Note that this tool is only connected to your savings or money market account to track savings progress. Select “Get Started” to continue.
• Step 3: To create a goal, select your goal type: Emergency Fund or Savings Goal. Name the goal, amount, and timeframe to complete setup.
• Step 4: Complete your goal! Savings Goal Getter will recommend transfer amounts in order to meet your goal by the deadline indicated. You can transfer manually or set up weekly or monthly transfers on the Recurring Transfers page.
Saving for an Emergency
Between the tools Huntington Bank offers for savings accounts and money market customers, and the suggestions I offered above for how to start saving for an emergency, I hope the goal of creating an emergency fund – or working toward any financial goal – seems a little less daunting.
Again, take it one step and one day at a time, celebrate the small wins and stay focused on your long-term goal. For more encouragement along your saving journey be sure to check out the Huntington Bank website to learn more about getting your finances ready for an emergency. You can also find Huntington Bank on Facebook, Instagram and Twitter.
What is holding you back from saving?
Disclosure: I am working with Huntington Bank as a 2019 Huntington Bank Influencer Ambassador and will receive compensation in exchange for writing blog posts about my experience as a Huntington Bank customer and highlighting the bank’s unique offerings. The content and opinions expressed here are all my own.