What You Didn’t Plan For

I am a huge fan of making plans. I love to take out my organiser and see what’s ahead for the coming week. I always like to know the plans that I have set in place, will indeed occur at that specific moment.

However, there are times when my plans do not always come to fruition.  I for one am not a huge fan of surprises, particularly those challenging surprises. Sometimes what I planned to do will have to take the back seat, while what I didn’t plan for will have to take the front seat.

Isn’t it the same when it comes to our finances? You budget for the month ahead, but then a surprise comes knocking at your door. Your four car tyres might burst. The car might break down.  Your child may need to go to the doctor for a fever. You may have to purchase medicine. Your tooth may need to be extracted. Your spouse may come home and tell you they lost their job today. These circumstances can sometimes cause a strain on your budget.

Take heart. Do not be discouraged, for there is a way you can effectively prepare for any unplanned circumstance.

There are two types of funds every family should consider saving towards:

  1. An Emergency Fund
  2. An Unemployment Fund

An Emergency Fund is a fund where you save money toward the following unplanned emergencies for example:

  • In the event of a sudden dental emergency
  • Vehicular repairs
  • Doctor visit for any family member who becomes sick
  • Battery and tyre replacements

Please note this fund should be used at the onset of an emergency, not for purchasing shoes or golf clubs on sale.

During these current economic times, and even during the best economic times, it is wise to set aside money for the unforeseen event of unemployment. This is where an Unemployment Fund comes in. Three months to a year’s worth of your most important expenses should be put toward this fund. Examples of these expenses include:

  • Rent or Mortgage
  • Electricity
  • Telephone
  • Commitments – Car Loan Payments etc.
  • Groceries
  • Gas – For the car and stove
  • Insurance – Health, Life, Pension etc.
  • Clothing

In the event money is withdrawn from these two types of funds, make it a priority to replace it. Remember, it will take time and discipline to save money toward these types of emergencies.

By setting up an emergency and unemployment fund, you are guaranteed to be at peace knowing your family will be cared for.

Astrape Finance

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