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How to Have Enough Funds in An Emergency

Contributed by Ruth-Anne Klassen 


Like so many folks, I find the rising costs of regular expenses like groceries, utilities, and gas worrisome. Rising costs make unexpected events like car or house repairs, medical bills, or a loss of income much more stressful. There is a way to lower the stress before the next financial emergency, by starting to prepare now.  

An emergency fund is your financial backup

Many people find it helpful to have an emergency fund that they can access when they need to pay for urgent items or services. Like the name suggests, an emergency fund is a source of money that you built and can dip into during unexpected and difficult times. It can be ready when you need it, with no application, bank approval or credit check required. You can feel good taking money out from an emergency fund when you need it.  

Having $500 can successfully bridge folks over small emergencies (America Saves, 2021). After saving $500 has been achieved, level up to your next savings goal by calculating your monthly expenses, which would form your new emergency fund goal. Keep up the savings snowball effect for three months, then six months, to weather your expenses through emergencies.  

If you are starting with no emergency savings, you can start saving small now. At one point, we were all at the zero-starting line. It takes time to build an emergency fund. If you ask yourself “what is one area in my spending plan that I can reduce?”, you might redirect monies from that area of the budget towards savings in an emergency fund. When we choose to make supper at home or reorganize our houses, for example, instead of getting takeout or updating home décor, we keep more money that can be put away in an emergency fund.  

Although the thought of lowering expenses may not be appealing, an emergency fund has advantages over other sources. 

Friends and family may have priorities and personal money lending changes relationship dynamics  

Since money and finances are so personal, asking financial favours of friends and family might change the dynamics and feelings of the relationships; re-negotiations of repayment schedules, asking for extensions of the initially borrowed amount, or having to ask for an increased amount, can all add unexpected tensions and may even hurt the relationship. Growing and deepening personal relationships can help with emergency situations in many ways, such as having someone to talk with, or someone to offer time to look after the kids.  

Borrowing money may hurt more than it helps 

Borrowing money have many risks such as interest and commitment to repay the funds. If the minimal payments are not made, then the missed payment(s) will be added to a person’s credit history which can lower their credit score. Meaning in the future, it may be challenging to borrow money. In essence, borrowing may be a quick way to get cash, but it can potentially cost much more than the loan you initially signed up for. 

Momentum offers a program encouraging you to save! 

If you could use the encouragement to start, and continue, contributing to an emergency fund, Momentum offers the Momentum Savings Challenge through the QUBER app. If you are low-income, you can receive cash rewards for up to 10 months each time you save $20! Find out more here. 


Young, K. (2021, January 31).  “38 Reasons you Need at Least a $500 Emergency Fund”. America Saves. https://americasaves.org/resource-center/insights/38-reasons-you-need-at-least-a-500-emergency-fund/ 

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