Monday, January 14, 2019, 6:00 AM – Severe weather can strike at any moment whether or not you are fully prepared, and the aftermath can be quite devastating and costly. The same can be said for financial emergencies, which can often result in unexpected expenses.
While environmental and financial emergencies are impossible to control, staying up to date with the weather forecast and your finances – and planning ahead – can help you prepare for whatever comes your way.
Even though Canadians feel prepared for inclement weather, according to a recent poll by RBC, they are not as prepared to deal with a financial storm. In fact, nearly half of Canadians (44 per cent) say they are more prepared for a stormy day than a financial emergency.
To help you and your family stay prepared, the experts at the Weather Network have partnered with RBC to provide tips to weather any financial storm.
THE BENEFITS OF EMERGENCY FUNDS
Preparedness is extremely important when weathering the unexpected, and one of the best ways to prepare is by creating an emergency fund. While everyone’s emergency fund will differ based on their income and expenses, RBC generally recommends saving at least three months of your total income.
This emergency fund calculator can help you see what that could mean for you.
Having adequate savings can not only prevent a difficult situation from getting worse, it can help you get your life back on track faster.
Don’t think you can save enough? Getting there can be easier than you think.
WEATHERING THE STORM
One tip: set up an automatic savings plan so you can save regularly without even having to think about it.
Another tip: digitally monitor your spending habits, cash flow and debts to help keep your finances on track.
And to help you reduce your debts: Don’t worry about paying your debts all off at once. Focus on the debt with the highest interest rate first, and once that’s paid off, move on to the debt with the next highest rate. This can help ease unnecessary burdens in times of financial hardship.
Lastly, when feeling the financial pinch, remember that while expenses like mortgage payments and rent may not change, you always have control over your variable expenses like eating out and entertainment. This is the first place to look if you want to cut back on costs and accelerate your savings.