It's never too late to start an emergency fund. Prioritize savings and begin setting funds aside in case of an emergency. Automating savings is an easy way to get started; consider setting up an automatic draft or transfer so that your money goes directly into your savings account. This way, you'll remove the temptation to spend it elsewhere.
When saving for a large investment or purchase, and even in times of job loss or a major reduction to your income, categorizing your spending between things you need and things you want can help you make better spending decisions. Things categorized as "needs" are essential for your daily life, such as groceries, rent, or utilities. These should take priority in your monthly budget. "Wants" are those things you can reduce or totally live without, such as entertainment, travel, and ordering takeout.
Multiple small purchases quickly add up by the end of the month. While spending a dollar here or there might not seem like much, it can take a toll on your budget over time. The best way to overcome this is to keep track of your spending. If you track all of your expenses (no matter how small) you might be surprised to see how much you really spend each month. You can use Online and Mobile Banking to keep up with your spending and account balances.
Once you've categorized your spending ("needs" vs. "wants"), it's time to evaluate your expenses and cut back on those non-essentials. The more you cut back on your spending, the more you'll have available for emergencies, and it could help add to your savings. A few ways you could cut back include buying generic brand items, or doing tasks yourself instead of hiring a service, like mowing the lawn. The key to cutting back is that it allows for you to "pay yourself first" and build up an emergency fund.
Do you have a hobby or skill you're good at, that you can market as a profitable product or service? What better way to boost your budget and make extra money than creating a side-hustle by doing something you enjoy? Even if you don't have a hobby, there are many opportunities available to increase your income such as food delivery, pet-sitting, freelance work, or selling unwanted items such as books, clothes, and electronics. Finding ways to earn extra cash will provide your budget with an extra cushion that you'll be grateful you have the next time an emergency comes up.
The hardest part of a budget can be sticking to it. It's important to do regular check-ins to help stay on track and keep spending under control. You might also find that some expenses vary from month-to-month, and some pop up annually. Or you might have income that fluctuates from month-to-month. You may make more from your freelance gig one month, giving you some extra cash. By checking in regularly, you can stay on top of your budget and prevent over-spending.
While you may not necessarily love the idea of creating or sticking to a budget, setting aside some time to do so is well worth it. If you stick with it long enough, you will achieve a financial goal or two, and find that you have the resources available to handle an emergency expense. Your wallet--and your future self--will thank you.