Ireland’s Guide To Money And Living

Rainy day readiness

While we always like to look on the bright side of life and assume that the best will happen, smart people do their best to plan for the bad times. That’s the idea behind a rainy day fund – having savings stashed somewhere so that when the unexpected happens, like your car blowing a gasket or unforeseen health problems, you’ll be able to deal with it without going into the red. Think of it as an investment in your future.

1. Make a savings commitment and stick to it, whether it’s €20, €40 or €100 each week. People might think they’ve nothing to spare, but even a modest weekly investment will accumulate over time – €40 per week for six months will leave you with €960 in your fund, for example.

2. One good way of making sure you save is to allocate all coins below a certain denomination to your savings fund – perhaps you could set aside all coins from €1 and below and add them to your fund at the end of each week.

3. Choose a good savings account. and have a handy comparison tool to find the best solution for you.

4. Beef up the fund with any unexpected windfalls of cash, or get rid of old and unwanted possessions via local car boot sales or on eBay, and invest the results in your fund. Unless you’ve got bills to pay, don’t be tempted to go on a shopping spree!

When not writing about all things personal finance, You & Your Money's editor Conor Forrest enjoys reading, football and getting lost in an ocean of Wikipedia articles.