How To Start An Emergency Fund [+ free printable!]

There are so many reasons why your finances can take a hit – job loss, sickness, house repairs, car maintenance, the list is endless – and it can be difficult to know where to start if that happens. Are you prepared if something rocks your financial ship? This post shows you exactly how to start an emergency fund.

As a rule of thumb, you should aim to have £1,000 in an starter emergency fund. This should be enough to cover any major expense that occurs, or if you need to get somewhere in a hurry. It could also stop you from borrowing from somewhere else to meet ends meet or using credit cards in the mean time. An emergency fund can also give you peace of mind that if something should happen, you have the funds to cover it.

Firstly, an emergency fund should be seen as just that – money used for emergencies only. It should be kept in a separate account which, although easily accessible, and should be treated as that; a separate fund. It might take some will power to not dip into but it is there for a more secure financial footing. Let’s look at how to start an emergency fund.

How do you save £1,000 into an emergency fund?

Firstly, it might take a while to accrue your emergency fund, and that’s ok! Transferring odd amounts over when you can is a great start and you’ll be surprised how quickly it adds up! But, it shouldn’t be a stressful experience; this money is there to help you in the long run.

Secondly, start monitoring your spending. Look for those little expenses that add up quickly, but could be avoided by some careful planning. Start tracking your incoming and outgoing; see what goes where and how much comes in. Then start to make tweaks to this, in order to be able to transfer the money over to your new emergency fund.

Thirdly, make a budget. Decide where your money is going each month; you work hard for that so it needs to work hard for you! This post has more on how to make a budget, but you work out how much income you bring in each month and then your monthly expenses – housing, council tax, water, electricity/gas and all of the variable expenses you have. Total these up and see if there’s anything left over. That can go into your emergency fund!

Choose where to keep your emergency fund.

If you can find a instant access savings account with a high interest rate, then use that. Interest rates are fairly low so look around and see what you can get. It might mean switching in a year, but that’s ok. Any interest you can get on your savings, the better 🙂

Finally, and this might be the hardest, stick to the savings plan! Whenever you have some spare money, then put it directly into your emergency fund. The more regularly you can do this, then the quicker your emergency fund will be in place. You then have some back up for when things go wrong.

Why It Matters

Well, we recently had to use ours when our cat came in with a grass seed stuck in his eye at 9:45PM at night. The nearest emergency vet we could find was a 40 minute drive and we had to pay a £295 bill there and then, plus another one three days later.

We used our emergency fund to pay for the costs, even though we were going to claim on our insurance (which we have done since and got some of our money back) because it meant the treatment was done immediately. I’m not saying that the cost didn’t hurt a bit but I knew we had the funds to pay for it, so I wasn’t worried. The cat is fine now too 🙂

To help you with this, I have made this free printable for you to use! It’s very simple; if you colour in all of the boxes then you will have saved £1,000 into your new emergency fund 🙂 and if you read my blog often, you know that I love a visual representation of something; I highlight all of my spending trackers in my budget planner so I can see where my money is going 🙂

So, the emergency fund printable looks like this:

If you click on this, you should be able to save it and print it out. Don’t forget to tag me in any pictures of you completing it! I can’t wait to see 🙂