I had only 11 peso coins left in my wallet, I’ve already missed two meals that day, and I’ve been going back and forth a hundred times to check the ATM if the salary was already credited. As expected,it was still zero balance. Just like my officemates who were frustrated and anxious, it felt like we were waiting for a manna to drop from heaven. We were already on dead-end…
If something goes wrong, we would be forcefully do fasting for the next day. That was five years ago. However, it is still the same ongoing battle-cry of thousands of employees across the country, “May sahod na ba?”
Same people, same sentiment, and same old, sad payday story.
That was my problem back then. I had to stretch my budget for the next payday. However, all the time, it always fell short. For an average employee, it was the most uncomfortable situation. It is similar to a rat race, it is going nowhere. Waiting for the next payday was no longer a good experience anymore. I have many questions in mind. What if something happen? What if a family member gets sick? What if there will be an emergency?
I’ve finally come to my senses. I had to put it a stop and I had to do something or I will die doing the same thing over and over again. From then on, I’ve made a bold step and a lifestyle change. My goal was to be financially secure that I would forget my salary day.
I’ve found the answer to it and it is building my emergency fund. It sounds new to most of the people but that time that I learned it and applied, my financially life transformed BIG TIME!
I’m no longer experiencing horrible long hours of waiting for the next salary. That is one of the perks of setting aside an amount for the rainy days and paying yourself first. You can also read my previous blog: Practical Tipid Tips to every Pinoy.
So What is exactly an Emergency Fund?
According to investopedia, an emergency fund is an account used to set aside funds needed in the event of a personal financial dilemma, such as the loss of a job, a debilitating illness or a major expense.It is encouraged to build a fund worth of 3-6 months of your monthly expenses before jumping into investing.
In building your emergency fund, you will get to know more to saving and budgeting. When I was building mine,I did the 70-30 principle. When I’ve received an income from any sources, I’ve set aside 30% for saving/emergency fund. I had to make use of the 70% for all of my expenses.
I simplified my life, avoided unnecessary expenses, became an avid jeepney commuter, stopped eating-out in expensive restaurants and brought lunchbox in our office. I had one thing in mind: Save. That was a humbling yet memorable season in my life. Indeed, it was time for planting for the future.
I got bored of the long wait, so I did a radical move. I made it 50-50 which is 50% for the Emergency fund and only 50% only for all of my budget and expenses. Being single helps a lot since it is easy to adjust on the budget. It was hard at first but things got easier as I continued. In the end, I was able to save 250,000 pesos for more than a year on my emergency fund. After all, my decision was right.
How to learn from the Ants?
The bible says in Proverbs 6:6; ” Ants are wise, they work hard and save for the future”. It is an invaluable lesson I learned early in life. Moreover, ants are wise, hard worker, takes initiative, diligent, and responsible. They’re just very small but during rainy days, they are one of the most secured creatures in the planet because they’ve prepared for it. These attributes are things that we should do the same.
So when is the best time to start saving for an emergency fund? The right time is today!
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