Life is full of surprises — some exciting, some expensive. Whether it’s an unexpected car repair, a medical bill, or a sudden job change, having money set aside can help you handle the unexpected without the added stress. That’s where an emergency fund comes in.
At Midwest Bank, we believe every family deserves the peace of mind that comes with being prepared. Here’s how to start building your emergency savings — no matter where you’re starting from.
What Is an Emergency Fund?
An emergency fund is money you set aside specifically for life’s unexpected expenses. It’s there to help cover costs like:
- Car or home repairs
- Medical or dental bills
- Job loss or reduced income
- Emergency travel
- Other unplanned expenses
Having this money available can help you avoid relying on credit cards or loans in a crisis.
How Much Should You Save?
Experts typically recommend saving three to six months’ worth of essential expenses, but even a small emergency fund is better than none.
Here’s a simple breakdown:
- Aim for $500 to $1,000 to start — this covers most minor emergencies
- Over time, work toward three months of expenses
- Adjust your goal based on your situation — homeowners, self-employed individuals, or those with variable income may want a larger fund
Where Should You Keep Your Emergency Fund?
Your emergency savings should be:
- Accessible — easy to withdraw when needed
- Separate — not mixed with your everyday spending account
- Safe — protected from market risk
A Midwest Bank savings account or Money Market account is a great place to keep your emergency fund. These accounts offer security, easy access, and competitive rates.
5 Simple Steps to Start Your Emergency Fund
- Set a Realistic Goal
Start small and build from there. Even $10 or $25 a week adds up over time. Use our Savings Calculator to set a target that feels achievable. - Automate Your Savings
The easiest way to save? Set up automatic transfers from your checking account to your savings. You won’t miss what you don’t see — and your emergency fund will grow consistently. - Use Unexpected Money Wisely
Tax refunds, bonuses, or cash gifts are great opportunities to boost your savings quickly. Consider directing a portion toward your emergency fund. - Reduce Unnecessary Expenses
Take a look at your budget and see where you can trim expenses. Small changes, like making coffee at home or canceling unused subscriptions, can free up extra savings. - Keep Your Emergency Fund for Emergencies Only
It can be tempting to dip into your savings for vacations or holiday shopping. Try to keep this account strictly for true emergencies to ensure it’s there when you really need it.
Ready to Start Saving? Midwest Bank Can Help.
Building an emergency fund takes time, but every dollar saved gets you closer to peace of mind. At Midwest Bank, we’re here to help with simple, secure savings solutions.
Stop by your nearest Midwest Bank location, or contact us to get started today.