In an article that I have written before titled "Requirements to Retire Early!", the first and one of the requirements that were indicated was To Have an Emergency Savings/Fund.
I have been very vocal about my goal of achieving FIRE or Financial Independence and Retire Early. This is my ultimate financial goal in life that is why I have been working hard and smart, grinding and hustling all day and all night, and trying to maximize every opportunity that I could get in order for me to earn additional income.
If you have observed, you probably already know that I don't have any plans to be spending my whole life working in a 9-to-5 job just to provide for my needs and necessary wants in life. I'm the type of person who doesn't want to be a slave to anyone or be commanded by anyone. I want to be financially independent for me to be able to pursue the things that make me happy, and for me to have time freedom where I can spend my time and day however I want it to be.
And in my quest to achieve FIRE (Financial Independence and Retire Early), the first thing that I need to do is to build my Emergency Fund.
To those who don't know, Emergency Fund is a separate fund or savings that is worth 3-6 months and can even be up to 12 months' worth of your monthly expenses, which includes your expenses for food, water and electricity, and other bills and expenditures that you have.
The purpose of building your Emergency Fund is for you to have something to use in case you lose your job or you got fired from your work for whatever reason, or you need money because of an emergency, or when there are unexpected events such as what we experienced right now, which is the global pandemic where most people lost their jobs and stuck at home.
So how much do I need to save in order for me To Build my Emergency Fund?
My Monthly Expenses:
Food- 5,000 pesos (This is assuming that my budget for food is only around 1,250 pesos per week.)
Water and Electric Bill- 1,500 pesos
Load Allowance- 500 pesos
Other Expenses- 3,000 pesos
Total Expenses- 10,000 pesos
Since I'm still living with my parents with little responsibilities in life, these are the only expenses I have for now. I don't have to pay any apartment rent since I have my own place to stay at the moment, but it'll probably be included in the computation once I move out to a different city or province already.
So if I were to save 10 months' worth of my computed monthly expenses, I will need to save a total of 100,000 pesos.
Actually, I have already built my Emergency Fund for quite a while now even before the pandemic came. However, because of my other financial goals in life, I have decided to split my Emergency Fund into two.
And now, I only have 50,000 pesos parked in my savings account that serves as my Emergency Fund. So with this fund I already have, I still need to save 50,000 pesos more to build my Emergency Fund.
My goal is to complete building it up before my 23rd birthday this December. And since it's July already, that means I still have around 5 months to work and save up to get this amount on time. That also means that I should save at least 10,000 pesos per month if I want to achieve my goal in my desired time.
So how am I going to save this amount if I don't even have a job yet, you might ask? And that's where my online side hustles come in. Most of the money I will save will probably come from my trading profits so I should strive to make more successful trades in a day. I will also keep on writing articles and making short posts to earn some BCH that will be converted for this purpose.
Saving 10,000 pesos in a month may sound too impossible but I am determined with my goal so I will make it possible somehow. Perhaps, more grind, hustle, patience, effort, and perseverance are what I need to accomplish this goal.
Cheers to Building My Emergency Fund!
There is a saying that he that fail to plan, plan to fail. Saving emergency fund is a vibrant idea for no one knows tomorrow. But at the same time you won't kill yourself simply because you don't have enough to save for the months. Life is full of uncertainties. Save the little you can at a time.