When it comes to your personal finances, it’s a good idea to expect the unexpected. Who could have predicted the arrival – and the impact - of the current pandemic, for example?
Any emergency demands on your money – the car that suddenly has to be replaced, an unexpected break in your employment, the boiler that breaks down – can hit hard.
To counter the impact of such emergencies, aim to build up a ‘rainy day’ fund equivalent to the cost of 3 months expenses. For example, if your essential personal and household expenses amount to €3,000 a month, then you are looking to save €9,000.
You might need to allow some time to build up this amount. For example, saving €250 a month into your rainy-day fund for 36 months will hit your €9,000 target.
It makes it easier to build this fund if you set up a monthly direct debit. In this way, the money is ‘gone’ each month, so you're not tempted to dip into it. Set up a direct debit to pay the money into a deposit account or a regular saving account as soon as you get paid.
Disclaimer
Life assurance and pensions products are provided by New Ireland Assurance Company plc., trading as Bank of Ireland Life. New Ireland Assurance Company plc., trading as Bank of Ireland Life is regulated by the Central Bank of Ireland.
Advice on Bank of Ireland Life products is provided by Bank of Ireland, trading as Bank of Ireland Insurance & Investments. Bank of Ireland trading as Bank of Ireland Insurance & Investments is regulated by the Central Bank of Ireland.
Bank of Ireland is a tied agent of New Ireland Assurance Company plc trading as Bank of Ireland Life for life assurance and pensions business.
Members of Bank of Ireland Group.
