I recently read a survey sponsored by GOBankingRates.com, in which 62% of American's had less than $1000 in savings, and in fact a whopping 28% had no savings at all. That mean almost 2/3 of the people in this country are just one large car repair bill or some other unexpected expense from disaster. That is a scary thought, and it should make everyone determined to set aside at least $1000 for an emergency fund.
I remember when I was first starting out on my own. I worked, rented a small apartment, and had no credit card debt. However, after paying the rent, car payment, utilities, and groceries there was almost nothing left over. I decided that I had to put at least $500 in savings (This was the late 80's and early 90's). It was hard, I had to make cuts wherever I could. That meant not always joining my friends for dinners in restaurants, going to movies, or having a closet full of clothes. Now that I am older, I realize I could have gotten a weekend job, or brown bagged it to work more, but eventually I had $500 saved up. Naturally, the moment I reached $500 I had a car repair bill that cost almost $500. Sigh! I started over. Managed to reach my magic goal of $500, only to do my taxes, and much to my surprise, found I owed the IRS, you guessed it, $500. Once again I was starting from scratch. I was so discouraged. I had worked so hard and gave up almost all of my social life to try to save, only to watch my savings evaporate. Frustrated, one night, I vented to my father. He pointed out to me at least I had the savings to fall back on. That did give me a better perspective that my efforts hadn't been entirely in vain.
That is the mindset I must keep front and center. I don't want to be one of the 62% that have less than $1000 saved, and I WILL NOT be one of the 28% with no savings.
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