The tougher the economy becomes the more likely we are to say that we can’t afford to save. Most people have very little money saved and live day to day on all of their income. This is not the way to plan for the future. If you do not have an emergency fund, what will you do when an emergency occurs? Unfortunately, the answer is usually that you will turn to credit cards. This is a poor solution and will only lead to more problems. That’s why an emergency fund is a necessity.

Financial advisers suggest that an emergency fund be sufficient to pay your living expenses for at least three months. This is a large sum of money for the average person but there are ways to work towards this goal.

Open a separate account specifically for your emergency fund. Use the type of account available with the highest interest yield.

Begin a change jar. Everyday you should deposit all of your change into this jar. When making debit purchases, request small amounts of money back so you can add that to the jar, also. At the end of each month, deposit this savings into your emergency fund bank account.

After you have paid off a loan, continue to make the same payments, but this time they should go directly into your “fund” account.

Reinvest your money into higher-yield accounts at every opportunity.

It may take some time to reach your goal of three months living expenses, but think of how good you will feel knowing that you are providing a safety net for the future for you and your family.