Don’t be side swiped by unexpected expenses that cause havoc on your finances.

OUDS suggest that consumers should be saving at least 10 percent of their income for unanticipated expenses. These are essentially for financial “emergencies,” such as replacing a broken fridge, an unplanned trip to the doctor to repairing damage to your home.

Luckily there are ways to build a stead fast emergency fund, consider taking these steps:

Get focused about repaying debt

Every cent that you pay in interest on an account is a rand that could be going to your savings. Therefore, paying off debt should be your number one top priority, even if it means taking a second job temporarily.

Use a direct deposit to save

Schedule a certain amount of your earnings to be automatically deposited into a separate savings account. You’ll get used to the monthly deduction over time, that you won’t even notice it coming off anymore. FNB has a “savings pocket” just for this sort of thing, if you already bank with them, or the other alternative I’m a favorite of, is setting up an account with Capitec Bank. The setup cost and banking fees are extremely cheap (better than any other bank) and all you need is a simple savings account, no mess no fuss.

Tucking away any small percentage of your earnings over time, can help you accumulate cash for a substantial emergency fund.

Take time before committing to a purchase

Online shops, stores and shopping networks make it extremely easy to buy now, one “click” and you’ve bought yourself a new pair of shoes. These “impulse purchases” can hammer your finances, realize you didn’t budget or plan this purchase. Taking the time to make a conscious decision before any purchase can help you decide what items are worth spending on, and what money can be put to better use growing in your emergency fund.

Don’t forget to reward yourself

Saving for an emergency fund shouldn’t be seen as a painful chore. Rather you should pat yourself on the back for your savings behaviours. When you deposit another R500 into your emergency fund, it’s OK to reward yourself with something small, like buying that T-shirt you’ve been eyeing out.

Think twice about using your credit card

It’s a fact that consumers spend more money when using credit cards than they would by paying with cash, so ditch the plastic. Carry your credit card with you only when you have a planned purchase to make, or an account to pay, nothing more.

Come up with an action plan to cut down on spending

Whether you settle your expenses first or take the remainder of what’s available at the end of the month, you’ll need to come up with an action plan to either increase your income; or reduce your spending in order to save. Work on a plan to reduce your spending in key areas by 5 or 10 percent, and deposit the savings into your emergency fund.

Be a proud while you watch your funds grow

Your regular deposits plus interest will inevitably cause your fund to grow. So be proud of yourself while you watch the balance of the account steadily increase over time. It will take time, so be patient.

Put your increase to good use

When you get an increase, it’s time to re-evaluate your budget. At least take a portion of that extra cash, and put it into your emergency fund. Sure your standard of living won’t increase, you shouldn’t be looking to waste your new found increase needlessly, but it won’t go down either.

Take advantage of cash back rewards, coupons, and rebates

Whenever you can, deposit any extra savings into your emergency fund. A rand here and there, it all adds up in the end.

Don’t quit before you even get started

Maybe in the past you tried and failed trying to start an emergency fund, but that doesn’t guarantee failure this time. You’re more likely to be successful this time around having learned from past experiences, so for it.

Anybody seeking debt advice can contact OUDS on 079 980 0822, for free assistance, help, or more information or visit our website.

OUDS is uniquely placed to tend to your best interests and see that you are financially secure, which you deserve.