When it comes to financial resolutions for 2023, there’s one goal at the top of many people’s lists: building an emergency fund. We’ll be referencing this article from CNBC.
A recent survey from Personal Capital found that 31% of respondents want to increase their emergency savings, topping other goals like purchasing a car, with 15%; saving to buy a home, 9%; or hosting a wedding, 8%.
Having savings set aside for unexpected expenses such as medical bills or car repairs can help people avoid high-interest debt and also stick to long-term goals like retirement savings.
If you’re looking to ramp up your emergency savings in 2023, these tips can help you get started.
1. Reduce your monthly bills
Chances are big savings can be found by reassessing your day-to-day expenses. That means looking at the 21 largest bills you have — if you have that many — and try to shop around or change them.
2. Reassess your credit card habits
By simply asking for a lower interest rate, you may be able to pare back how much it takes to pay down those debts.
It may also help to seek better rates elsewhere — either through a 0% interest balance transfer credit card or a personal loan.
Also take stock of any rewards you’ve accumulated to see how you can turn them into extra funds.
3. Look for higher rates on your cash
As interest rates climb, that’s good news for the money you stand to earn on your cash.
If your emergency fund has less than the three to six months’ expenses typically recommended by experts, having quick access to your cash should be your first priority, according to Greg McBride, chief financial analyst at Bankrate.com.
In that case, online savings accounts may work best. Even socking away a small amount of cash per week can add up over time.
4. Sell what you aren’t using
If you haven’t used something in a year — aside from family heirlooms or holiday decorations — it’s time to sell it.
5. Pick up a side hustle
Generating more money doesn’t have to stop at selling your things; you can also sell your skills.
Websites like Fiverr will let you list your services so you can generate extra money.