
After what happened last year, being ready financially is indeed a necessary thing to do now. Few people live day to day ending up no back up finances for any emergency that may happen in the future. What does it result to? HAVING MORE DEBT!
The kind mindset of most people have is…
“Live in the moment!”
“Let’s be happy go lucky!”
“Spend now, save later.”
Well, I don’t have anything against it but the question is, will it help you once something bad will happen? Let’s just think of something that happened last year.
- Termination from work.
- Deduction of salaries from a lot of profit based companies.
- Skeletal schedule that results to less paycheck every month.
- Sudden Death of a family member.
- Environmental Challenges that may affect living condition.
- Changes from face to face to classes to online classes that requires internet connections and gadgets (laptop).
- Sudden medical expenses.
This may sound surreal but these are just SOME of the common problems all of us faced last year and may encounter as well in the future. Who knows?
So why do you think having emergency fund is important especially for Filipinos? Well it is simply because most of us live in a “Close Family Ties Relationship”. We can’t just simply act like we don’t care if any of our family relatives faces challenges in their lives. That sounds absurd if we brush off the pains of others, right?
Another reason is most Filipinos are the “Breadwinner” of the family. It’s pretty common in our culture to have someone that bears most of the responsibility. You’re lucky if you didn’t experience that, but for those who are right now this blog is all for you.
Note: Just to clear things out, you don’t need to have a lot of money for you to have an emergency fund. You can take everything slowly but surely. If you don’t have any idea on how you start it, let this blog guide you. You can also check some of my blogs that tackles how I manage my finances.
1. Set your emergency fund goal.
This is the initial but the most crucial part before starting this fund. It is very important to determine this since this will be guide for you to know the necessary strategies for you to achieve it. Here are the things that you need to consider before deciding your target amount:
- Calculate the expenses that you spend every month. (Bills, Rent, Grocery, Food Expenses, Debt Settlement etc.)
- Determine how many months you wanted to cover your emergency fund (6 months, 1 year etc.).
- Once you had decided it, multiply the total of your monthly expenses to the number of months you’d come up with.

If you’re just starting and looking for a guide in your finances, you can check out this blog!
2. Make a Budget.
After knowing your emergency goal, you need to add it in your budget. Set a target on how many months you wanted to achieve it so you can work on it every month.

For deciding the months you need to save for your emergency fund, you need to consider the following:
- Your monthly cash in should cover all of your expenses, savings and emergency fund.
- The more months you planned to save, the more less it will be for your emergency fund monthly savings. So you need to make sure if you’re comfortable with the amount you planned to save every month for it.
- Don’t overdo it and pressure yourself. Like what I stated before, you can take everything slowly but surely. This is your fund anyway so you’ll be the only one who’ll be benefited from it.
3. Provide an account that will be entirely only for emergency purposes.
Since this savings is only intended for an emergency, it is very important that you need to secure it. If you have an existing account but you usually use it for a lot of purposes, it will not be ideal to save it from there.
In my opinion, it will be very effective if you’ll save it in another account so that you won’t have a chance to spend it. You need also to consider the accessibility since this is intended for any emergency. Don’t put in a time deposit account or else that would be difficult for you to withdraw it. If you don’t have any idea where to save, you can check this out.
Best Saving Account in the Philippines 2020
4. Record your every cash-in and cash-out.
For you to make sure that you’ll stick your budget, a tracking sheet will be very effective. Take note all of your expenses and savings every month so you’ll have an idea the amount you still need to work out.

Having a tracker will give you information on where your funds all go. Some people usually ends up not knowing it so they always ends up thinking that they don’t have much funds to put in their savings.
For me I usually stick to this savings rule. It helped me a lot to monitor my expenses and at the same time live to my budget. We usually followed the other way around where people usually saves up the rest of their funds once they’re done spending it, but that’s the mindset that we need to change.
INCOME – SAVINGS= EXPENSES
By following this you’ll surely realize that you can actually live to any amount as long as you make sure that you won’t touch your savings.
5. Stick to your plan!
The last but the most important step you need to take.
Any plans will stay as a plan if you never work on it. You need to make it a point that you’ll achieve your emergency goal no matter what happen. If you don’t want to end up living on the edge every time, this is your cue to change that mindset.
Isn’t it nice to feel that you have this secure back up what ever may happen? Having an emergency fund is just the initial start of your saving. As long as you have it, you will be rest assured in funding more of your future planned financial goals because you know that you’re confident enough that nothing will affect it.
Actually it doesn’t really that hard to pursue it, but you just need to have this right attitude and approach to make it happen. As for me, it helped me a lot especially when I lost my job and was unemployed for six months. I entirely used my emergency fund without asking my parents for any financial assistance.
If you want to check my financial goals for the year 2021 and the strategy I’ll do to make it happen, you can check out my blog regarding this.
As the saying goes,
The rich don’t work for money. They make money work for them.”
-TheSuccessClub
Make your emergency goal the first step towards your financial freedom. Just take the first step and the rest will be easier for you. That’s a FACT.