It can always be useful to have some money available to fall back on in case you have an emergency. It can however, be difficult to know how much money to keep by. This is because it is hard to predict what sort of emergency we may need the money for. If we write off an uninsured vehicle that we need to replace, this will cost us a lot more money than getting a broken fridge repaired but it is something that we will still need to find the money for. However, our current situation as well as the availability of other options can be something to consider as well.

Can I get a loan?



It is worth starting with considering whether you would be able to borrow the money that you might need via an online lender like Cobra Payday Loans. Although a loan will cost money, it can be a convenient option for many of us. Although you might like to have some savings behind you as well, it could be reassuring to know that you have the option of borrowing if you need to. Of course, some people have limited borrowing ability because they do not have a good credit record. If this is something that you are concerned about then it could be worth checking your credit record and considering whether there is anything that you can do to improve it. This can start with making sure the information on it is correct as sometimes there is incorrect information which can affect your score. It is also worth finding out more about what determines a good credit score and whether there are things that you can do which will improve yours.

Even if you do have a poor credit record there are some loans available for you. This means that even if you have no savings or not enough, you will still have some options. All loans are expensive and may not be the ideal solution but knowing that there will be those options available can help to put your mind at risk.

Do I have expensive things I will need to pay for?



It is also worth thinking about whether you really need to be that well prepared. There will be determined by what sorts of things you will need to buy. For example, in the example of needing a new car, it could be that it might be better to pay a bit more insurance so that you can get a hire car if your car is out of use or perhaps you might be able to pay for a hire car, use a family members car, use public transport or get a lift with someone. It can be easy to panic about what you might need to replace, but we can actually manage with a lot less than we might think. It could really be the day to day things that are more important.

For example, if you have a cash flow problem, then it could be paying bills, rent and buying food that could be more of a concern. Having enough money to pay for these could be more important than worrying about replacing expensive items. So, it can be worth thinking about what your essentials cost and perhaps have enough savings to pay for these. If you feel that there is a risk that you may lose your job and therefore not have an income for a while then having enough money to cover these for a while could be worth it. It is good to think about how long you might be out of work and need the money for and this will allow you to feel more relaxed knowing that you will be able to manage in this circumstance.

How much can I afford to save?



Obviously, the amount that you can save will be limited by what you can afford. However, it can be a sensible idea to start savings a little each month, even if it is just a small amount. It is good to set up a transfer so that money leaves your account when you are paid and goes to a savings account. To work out how much you can afford you may need to do some calculations. It is worth looking at how much you normally have coming into your bank account and how much you normally pay out and you will be able to see what is left.

If you do not have much left or feel that you should be saving larger amounts then you might need to make other changes. It might be a good idea to think about what you might find easy to do. It could be that you can try to earn more but for many of us, working more hours may not be an option due to stress or family commitments. It can often be easier to reduce spending instead. Perhaps the easiest way might be to compare prices and try to switch to buying cheaper things. This will mean that we will not need to go without anything but can still save some money. However, you might want to take more drastic measures as well. You may want to cut back on spending on luxuries so that you have more money available to save. It might be that you will only need to do this for a while as once you have built up some savings you will not need to keep adding to the. However, if you do need to dip into them, you will need to find a way to replenish them again.