7 Tips to Grow Your Emergency Fund

Unexpected expenses rarely arrive at a convenient time. Whether it’s a car repair, a medical bill, a home repair, or an unexpected job change, having money set aside can help you handle life’s surprises with less stress.

Building an emergency fund may feel impossible when you’re already stretching every paycheck. The good news is that you don’t need to save hundreds of dollars at a time to make meaningful progress. Small, consistent habits can grow into a financial cushion that gives you greater confidence and peace of mind.

Financial Literacy Month is the perfect reminder to strengthen the habits that support your long-term goals. If you’re just getting started or looking for simple ways to grow your savings faster, these practical tips can help you build your emergency fund one step at a time.

Start with a small savings goal, celebrate each milestone, and gradually increase your target as your confidence grows.

Try these seven simple ways to grow your emergency fund:

1. Small Automatic Deposits.

Chances are you need all or most of your paycheck each period. However, you can save a small portion of this amount by having it automatically deposited into your savings account. Most banks will allow you to set up automatic transfers. Each time your paycheck is due in, schedule a transfer to savings.

• Even if this amount is $5, it will add up over time.
• Participate in a savings challenge that will help you get into the habit of saving regularly
• Automate your savings with your bank’s automatic savings tools or a trusted savings app

2. Pay With Cash.

When you pay for your essentials with cash, you’re really seeing the exact amounts of money you’re spending as the money changes hands. Then drop the change from these transactions into a jar when you get home. Before you know it, you’ll be depositing large amounts of change into your savings account with little effort!

3. Credit Card Round Up.

Many banks and financial apps now offer round-up savings features. The rounded amount will be automatically deposited into your savings account. Getting one of these card accounts could make adding to your savings account easier on you.

4. Add Up Your Charges.

One month, add up everything you spend. It doesn’t matter how you’ve made the purchases – cash, credit, debit, etc. In analyzing these expenses you’ll likely find some recurring expenses that can go. Perhaps there’s something you could live without. That small expense will pay you back in the future if you add it to your savings instead.

5. Avoid Impulse Buys.

Everyone has fallen victim to an impulse buy at some point. Make a pact with yourself that you’ll never make them again. Instead, when you feel the need to get something, give yourself a 24-hour cooling off period.

•  If you still feel that you must have it after that time, go ahead and spend the money. If you’ve thought it over and you don’t need it, perhaps that money is better spent going directly into your savings account. You’ll likely find that you decide against making the purchase.

If you like, you can also go one step beyond avoiding impulse buys by actively selling things you own. Many people’s homes are filled with valuable possessions that they never use. Have a new smartphone? Sell the one it’s replacing. Have some old coins? Use a coin appraisal service to see how much they’re worth. When you look hard enough, you’ll likely find something that you can sell — and when you do, the money can go straight into your emergency fund. 

6. Avoid Credit Card Use.

If you have trouble paying off your credit cards in full each month, stop using your cards. Switch over to cash and debit card use and slowly pay down the balance on your credit card.

•  As your balances are paid off, the money you used to pay in interest to the credit card companies can be better spent in your savings account.

7. Reduce Everyday Expenses.

Do an evaluation of your required expenses such as internet, phone, and grocery bills. See if there are any ways to reduce these bills.

•  For instance, maybe you could easily switch to a lower cost phone plan or start clipping coupons at the grocery store.
•  If you could find an extra $50 in your budget this way, you can greatly improve the look of your savings account!

While you don’t need to implement all of these changes at once, you should now have a better idea of the many ways you can add to savings. Just remember that even a few cents can go a long way!