Did you raid your savings since the start of the crisis? If so, you’re in good company.
The pandemic caused a world of financial upheaval for many people. Not only did millions lose their jobs, but many workers were forced to drop out of the labor force due to health concerns or a lack of childcare. It’s not surprising, then, to learn that 29% of Americans were forced to tap their emergency funds during the pandemic, according to a new survey from Discover Personal Loans.
Now to be clear, the purpose of having an emergency fund is to cover unplanned expenses or deal with unplanned financial circumstances, like job loss. But if you had to raid your savings account during the pandemic, you may, at this point, be eager to replace the money you had to take out. Here are a few steps you can take to make replenishing your emergency savings easier.
1. Revisit your budget
Following a budget is a great way to monitor your spending and stay on track for meeting savings goals. But if you’re looking to replenish your emergency fund, it may be time to revisit your budget and make changes that allow you to eke out more savings.
Take a look at your different expenses and identify those that can be classified as non-essential — things like cable TV, streaming services, and other types of entertainment. Then, prioritize those and choose a few bills to cut back on. That could mean keeping one streaming service but canceling another, or only ordering takeout once a week instead of twice.
If you’re already spending no money on non-essentials, there may not be much tweaking to do to your budget. In that case, your best bet may be to get creative with your existing bills. That could mean negotiating a better rate with your cellphone provider or getting a roommate to split your rent with.
2. Boost your income with a side hustle
If you don’t have many expenses in your budget to cut back on, then you may need to get a second job to replenish your emergency fund. The good news, though, is there are many different side hustle opportunities available in today’s gig economy. And if you’re able to put in some time, you could boost your earnings in a meaningful way.
Take a look at your schedule and figure out how many hours you can afford to dedicate to a side gig. From there, explore different options based on your income goals and constraints.