(The Wall Street Journal) – The sad lack of emergency savings is a well-known and often-lamented condition for a huge number of people. And it’s never been more apparent – or more dangerous – than in our coronavirus-induced economic downturn.

According to a 2019 study by the Federal Reserve, roughly four in 10 Americans wouldn’t be able to come up with $400 in a financial emergency.

Part of the problem, of course, is on the income side: Too many people don’t make enough money to live on, let alone accumulate funds for a rainy day. But part of the problem is also that people don’t know how to save. They want to put aside money, but it just seems too daunting. They don’t even know where to start.

So we asked financial advisers, behavioural economists and other experts to help. We wanted to know some simple tactics – tricks, if you will – that people can use to jump-start their emergency-savings accounts.

It turns out, there are plenty, and we offer 35 of them here. Not every tactic will resonate with everybody. But we believe there are enough that even the most reluctant savers will find some approach that allows them to sleep better at night.

Rank your expenses

Download the past few monthly credit and/or debit-card statements or export your transactions to a spreadsheet. Print off two copies so you can do this exercise with your significant other. If you’re single, you can do it with a trusted family member or friend. Next, review the transactions separately, using a pen to mark each expense as “high,” “medium,” or “low” importance. Then compare notes. Items you both marked as “low” are the expenses you can happily eliminate going forward.

Reimbursements as windfalls

Direct reimbursements from your flexible spending account (FSA) and/or dependent-care account to a high-yield savings account or money-market account. These employer-based accounts allow employees to set aside funds on a tax-free basis to pay qualified medical and dependent care, respectively. The strategy is to pay for qualified expenses with personal funds and request reimbursement from the plan administrator. The reimbursements will seem like windfalls since cash has already been spent.

The extra payday

If you are paid biweekly, two months out of the year contain an extra payday. That extra paycheck is an opportunity for big savings. You probably can’t slide the whole thing over to savings at once, but you can migrate the amount of that extra check into your savings over a period of weeks or months.

Funding with a refund

Increase the amount of your tax withholding from your paycheck. Doing so will generally result in a larger refund when you do your taxes. And direct that extra money to an emergency fund. This approach is really helpful to those who have a tough time budgeting a monthly amount for an emergency fund.

Stop outsourcing

Because of the pandemic, many of us have been at home doing chores that we may have outsourced in the past: things like cleaning, mowing the lawn and cooking. Let’s use that saved money to “pay ourselves” (it is indeed our reward for an avoided expense) and earmark it to be used for a rainy day.

One expense at a time

Pick one expense a month and cut it from your spending. For example, if you go to Starbucks daily, start making your own coffee. Next month, reduce your dining out by one night a month. And so on…

Sweatpants tax

One of the silver linings of the pandemic (at least for me) has been that sweatpants have made a regular appearance in my wardrobe. When things get back to normal, it will be much more difficult returning to less-comfortable clothing. Enter the sweatpants tax. Savers could start charging themselves a small fee every time they wear sweatpants. This idea is consistent with the popular app stickK.com, a commitment platform that helps people reach their goals by putting money on the line if they fail. People are rather successful at pairing a wanted behavior (say, wearing more comfortable sweatpants) with a should behaviour (saving for an emergency).

Borrow from the future

Take the amount you’re investing into your retirement plan that is over and above the company match (if you have one) and split it between savings and retirement investing until you reach your emergency-fund goal.

Step up

Set up an auto-transfer of money to an emergency-savings account with built-in escalators. You can start with whatever amount is comfortable, and schedule the amount to increase by either a percentage or dollar amount at set intervals.

The change adds up

Consider using a “round-up” app like Digit or Acorns. These apps connect to your credit and debit cards, round up your charges to the nearest dollar, and automatically deposit the round-up amount into a savings or investment account. It might only be 25 cents here and there, but it can quickly add up over time. Just be careful the money being saved is going into an FDIC-insured bank account and not stocks and bonds. Also, be conscious of the fees being charged by these round-up apps.

Splurge and save

Anytime you make a frivolous, splurge purchase – whether that’s dining out, buying a new pair of shoes, or even something as small as buying name-brand cereal rather than the generic – force yourself to automatically sock away an equal amount of money into a rainy-day savings account. This has a few advantages: It makes the associations with saving less painful; it effectively doubles the price of the splurge, thereby inducing a little more caution before spending; and it creates an easy way to track how much you’re spending on frivolous things since the size of the emergency savings account will mirror the amount of frivolous spending.

Investment line of credit

Apply for a secured line of credit tied to a brokerage investment account. This gives you access to money without having to sell your investment holdings at a lower price than you would like. Currently, interest rates are low for this approach.

Lower rates, smaller payments

Interest rates are near historic lows for many types of loans. So, try to refinance your mortgage, auto loan, personal loan or student loan. Lower rates can lead to lower monthly payments and more of your money going toward principal. And with the lower payments, put the difference in payments toward your emergency fund.

Pay it with points

Build up a stash of credit-card rewards points as part of an emergency fund. I always keep at least 25,000 points on my AmEx as a backup emergency fund. I can use my points to pay for groceries at Walmart or Amazon, or pay for things through PayPal.

Out with the old

During the break from standard life during coronavirus, many of us have realized that the way we acted in the pre-coronavirus time did not necessarily maximize our happiness. I, for example, realized that I am able to cook some simple dishes and that I actually enjoy it. So take the things that you now realize you used to spend money on but that did not give you much joy in life (such as eating out regularly) and moving forward don’t go back to those old spending habits.

Don’t spend that raise

All increases in compensation in excess of inflation can be added to an emergency fund until the desired amount is reached.

Limit extra debt payments

If you are paying down debt, don’t pay less than the minimum payment just to contribute to your emergency fund. But if your minimum payments are manageable, then build your emergency fund while you are paying down debt. Until you have at least three months of emergency savings, consider putting 50% of your available funds toward extra debt payments and 50% toward your emergency fund.

Save for categories

Don’t think about saving for generic “emergency funds.” Instead, create specific categories of expenses you might need to save for, such as “three-month emergency rent money.” By breaking down a broad goal into something vivid and specific, you can make savings goals more motivating.

Don’t look

Have all of your income come into a savings account that you don’t see when you log in to your bank online. Once a month, transfer your spending budget for the month to your checking account. This creates a natural spending limit that allows you to not worry about detailed budgeting.

HSA as forced savings

If you have a Health Savings Account (HSA), build it up. And if you can pay for regular out-of-pocket medical expenses with other money, don’t take from the HSA. It acts like forced savings. Then in times of emergency, you can tap the HSA for reimbursement for those previous medical expenses – basically reimbursing yourself for medical costs you incurred in prior years.

Free money at work

Make sure you take advantage of the commonly overlooked fine-print benefits at work, including reimbursements for backup child care, gym memberships and cellphones. When you get those reimbursements, transfer them to your emergency account.

Sell and save

Places like Facebook Marketplace, Craigslist, Poshmark, etc. allow you an easy avenue to sell unnecessary items. Use the proceeds from these sales to build an emergency-savings fund. You can sell something once a month, thereby continually contributing to the fund.

Increase deductibles

Look at the deductibles on your auto and homeowners insurance policies. Many people have deductibles that are much too low given their claims history and could save hundreds or even thousands of dollars annually on premiums if they increased their deductibles. Also, consider eliminating collision insurance if your car is older. Your insurer may issue a prorated premium refund. Redirect that money (and the additional premiums you would have paid in the future) into your emergency fund.

A public commitment

Instead of birthday gifts, ask family and friends to crowdfund an emergency-savings account. And make it more credible with a “commitment device” – a penalty for failing to follow through and use the donated money only for emergencies. Savers can establish circumstances under which the funds might be used – such as promising to only dip into the funds to pay for a medical emergency or to ease an unemployment spell. The more credible the commitment, the more comfortable givers may be to contribute. Contributors can be rewarded with an occasional update.

Points to cash

Get a credit card that pays points that can be converted to cash. Then deposit that cash into your emergency savings.

Lost and found money

Use MissingMoney.com to search for unclaimed property held in state treasury departments as well as unclaimed retirement-account balances. You can search on behalf of yourself and family members. If you have a common last name like Smith or Johnson, it may take you much longer than if you have unique last name. There is a certain amount of paperwork involved to file a claim, and you must provide proof of identity. But it may be worth the time to uncover funds to add to a rainy-day account.

Online challenge

I join “no spend” challenges on social media and recommend it to others because it’s encouraging to work in a group. You choose the length of time – a weekend, week or month – during which you commit to not spend any money or eliminate unnecessary spending. You then post your progress daily and tag other participants in the challenge. Group members encourage each other and help keep everyone accountable to individual saving goals. You then take the money that you otherwise would have spent and transfer it to your rainy-day fund.

Think small

Create shorter-term goals. If $3,000 is one month of expenses, set a goal to try to save 5% to 10% of that amount a month or break it up into weekly deposits.

Take stock

I recommend that investors consider the Level3 Withdrawal Strategy, developed by the founder of American Association of Individual Investors. It divides a portfolio into two parts: equity and safe. The equity part is allocated to stocks. The safe part is allocated to cash and equivalents. Two to four years’ worth of planned withdrawals should be held in this second part. During periods when stocks are within 5% of their highs, withdraw from the equity part. When stocks fall, withdrawals are taken from the safe part. Once the market rebounds, replenish the safe part from the equity side to ensure you have enough cash to protect your portfolio during the next downturn.

Make money rules

Create a list of money rules, including how you will handle unexpected income. For example, if you receive a bonus or tax refund, where will the money go? I recommend spending 50% and saving 50%. Then, set a time in your calendar to review the rules every six months to ensure you’re on track.

Bring your lunch

Pack a lunch for yourself one or two days a week and put at least $5 per meal into your emergency savings.

Paid opinions

Get paid for online surveys. The next time you’re watching your favorite show on Netflix, multitask by completing online surveys or product reviews. Sites like Opinion Outpost, Swagbucks or Global Test Market will pay for your feedback.

Money jar

Save all your $10 bills. Then go to the bank monthly and deposit them in an emergency savings account.

Get a side hustle

Start a side job or earn weekend income. Everyone has a passion, and many people can turn this into a side hustle by thinking creatively. For example, an avid sports fan could become a part-time golf caddie; an artist could sell their paintings online; and an animal lover could pet-sit. Then, direct those earnings into an emergency account.

Keep dividends

Stop reinvesting dividends and interest payments within your investment portfolio. Instead, that income can build up in cash or a money market account, where it is readily accessible. Dividends and interest payments can quickly amount to months of additional expense money without eroding an investor’s principal.

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