Friday, October 14, 2022

At YNCU, we understand how unpredictable life can be and we want to help set you up for financial success. Oftentimes, when planning finances, people only think of their savings, retirement, and managing their debt. People often forget to plan for emergencies. Emergencies can happen at any time (take the pandemic for example) and you never know when unexpected costs will arise.

An emergency fund is what we at YNCU refer to as the money you set aside to prepare for unexpected expenses, like urgent vehicle maintenance, job loss, veterinarian visits, and health problems that result in missed work. You will more than likely be met with a situation where you need money fast, or experience a drop in income at some point in your lifetime. These surprises usually don’t give you enough time to adjust your budget.

It is important not to confuse unexpected expenses with occasional expenses such as school supplies, winter tires or holiday expenses. Occasional expenses should already be planned for in your budget.

Make sure you are setting aside a reasonable amount each month for your emergency fund. Although it’s important to save gradually and plan ahead, it’s not helpful to break your budget to do so. By putting aside a little every few weeks, you will have enough to cover those unexpected situations. Also remember to take advantage of every chance that can help you add to your emergency fund. Deposit any additional amount into your savings whenever you can. The general rule of thumb is to save 3-6 months’ salary for your emergency fund, but do what works for you and your budget.

YNCU is now offering an Emergency Savings Account that offers a higher rate than our traditional savings accounts, has no minimum balance requirements, and no monthly fees. We recommend setting up recurring contributions to be auto deposited into your emergency savings every pay period. This product was created because YNCU listened to the needs of our members to help them stay on track for their financial goals even when something unpredictable occurs. This emergency savings account makes it possible to:

  • Handle an unexpected expense without going into debt
  • Avoid high-cost loans (like payday loans or credit card cash advances)
  • Avoid incurring costly credit card interest rates
  • Have financial control and peace of mind

Learn more about the Emergency Savings Plan here!

For all your general financial inquiries and how you can plan out your financial goals, come talk with someone at your YNCU branch!