When asked what best predicts financial satisfaction, more people said having an emergency fund than said paying off a credit card or owning a home, according to a recent University of Georgia study. Despite this, many people ignore the advice to have an emergency fund that would get them through three to six months of no income. Studies find, in fact, that 43 percent of households have less than $1,000 in liquid savings and 28 percent live paycheck to paycheck without any savings at all.
There is no magic bullet for saving. The most important step is the first one: make a commitment to save. Calculate what you need for your emergency fund, set a goal, make a plan and start saving today. Even a few dollars a month means you’re more prepared than you were before for an emergency.