Used as a metaphor for financial difficulties, rainy day savings is the money set aside for those ‘not-so-sunny’ economic hardships that involve digging into money previously set aside in preparation. An article published in the Seattle Times encourages individuals to first analyze how much money they are able to save based on their monthly expenses. To do so, Financially Fit Me (FFMe) provides financial tools such as simple budgeting worksheets and savings calculators that help members visualize the division of their earnings, and gives a clear-cut dollar amount they should aim to save each period. Once that value is determined, 1st Security Bank, the sponsored author of the article, recommends building your rainy day fund so it will support three to six months worth of mandatory expenses (i.e. rent, food, electricity) with no additional income. Therefore, in times of unforeseen circumstances, you can rely on your financial planning to support you and your family.
In addition to contributing to your rainy day fund, Seattle Times suggests creating multiple savings funds that are specific to certain needs or wants. For example, if you’re planning to do a house renovation or go on a family vacation, don’t use your rainy day fund as a “piggy bank” where you can take out money whenever for whatever reason. Instead, create financial goals with FFMe and start financially planning for your next luxury want without digging into your previous savings.
We want to encourage financial growth among members, and planning ahead is a key component! Start your free membership today with FFMe and begin preparing for those rainy days.
Written By: Your Financially Fit Me Team