How To Save Up Money For Big Emergency Purchases
Even if you have a full-time job, it can be hard to make a big purchase without going into additional debt – especially if you’re already living paycheck to paycheck.
And the more pressing the need to make the purchase, the more it may seem like there’s no way to avoid putting the purchase on your credit card. So how do you save up money to make it happen without adding to the debt? Do you look into things like title loans?
Here is our step-by-step guide on how to save up money for making big purchases without busting your budget.
1. Set Up A Sinking Fund
Being one step ahead of the game is always the easiest solution. Keeping a sinking fund specifically for big purchases might seem like a luxury, but the moment the need for the purchase arises – and it will arise one of these days – you’ll move and need new furniture, your car will need new parts, or you’ll have to pay for home repairs – you’ll find it much easier to deal with – because the money is already there.
Sinking funds are much easier to fund when you have ample time – i.e. the need for the purchase isn’t pressing. Putting aside $50 a month for a purchase you might not need in years to come is a much simpler affair than putting aside $150 when the thing in question is on its last legs and you are praying it lasts long enough that you’re able to get the funds together.
And, keep in mind, sinking funds are not the same as emergency funds – you don’t need to be very precise with the amount you’ll keep in there. So after reaching a certain threshold, you can either cut down on the amount you’re putting there each month or even pause it every once in a while. As long as you know you’ll be able to cover the rest with no trouble if the urgent need for the purchase arose.
2. Pay Yourself First
Money with no designation is money you’re going to spend. Lifestyle creep is very real; so even if you suddenly get a raise, you will keep living paycheck to paycheck unless you know how exactly to utilize that raise purposefully.
So the very first thing you have to do when you get your paycheck – no matter how big or small – is to put some money away in savings. This way you won’t be spending money you need on unnecessary things, even if you’re not a budgeter and don’t track your spending.
The saving priorities should go this way: your emergency fund, your sinking funds, your long-term savings – like retirement.
3. Decrease Your Spending And Increase Your Income
If you see that you aren’t able to save money at the speed that you need, you might need to make some big changes to your budget.
The first change is you need to decrease your spending so that you can put extra money in your savings. Review your bank statements and cut the things you pay money for but don’t utilize very often: gym membership, subscriptions, cable, etc.
The second change is to find additional sources of income. You can do this by trying your hand at freelancing, making deliveries, etc.
Remember not to prioritize the sinking fund over the emergency fund. Make sure it’s fully set before you start depositing money in the sinking fund.
4. Do Not Dig Into Your Emergency Fund
It’s recommended you resist digging into your emergency fund for as long as possible. But alas – there are situations when the big purchases are emergencies. After all, if your laptop breaks down and cannot be fixed – you can’t simply avoid working. This is when your emergency fund takes precedence over all other types of savings.
Look At Title Loans If All Else Fails
If you’ve yet to set up the emergency fund and you need money as soon as possible, you might want to check out short-term fast loans, like title loans. This is a loan you receive when you use your vehicle’s title as collateral. The good thing is you can use the title from any vehicle you own – whether that be a car, truck, SUV, RV, or even a motorcycle.
Why Should You Choose Title Loans?
If you’re a car owner, then a title loan is the easiest way to get cash. Our lenders at Utah Title Loans will accommodate almost any kind of credit score, so you can get approved even if your credit is bad or nonexistent altogether.
How Do I Find Title Loans Near Me?
Getting through our process is simple. Just go to our website and fill out the online form. You’ll be contacted by one of our loan representatives from a title loans near me, who’ll walk you through the rest of the process. This is also when you can give the rep a location where they can meet you instead of you coming to the store.
Regardless of whether you come to the store or we come to you, you’ll need to bring your vehicle for inspection, along with your car’s title that must be in your name and completely lien-free, and your driver’s license or valid government ID to prove you’re over 18.
The representative will assess everything and decide if you qualify. If you’re approved, you’ll get the cash either the same day or the next bank business day.
Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.