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14 Tips For Building An Emergency Fund In 5 Months

14 Tips For Building An Emergency Fund In 5 Months
Amy Baum Aug 25, 2017
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I stumbled across the concept of an emergency savings fund a few years ago. As the name suggests, this type of savings fund is solely for urgent situations. Some examples include losing your job, costs from a car accident, or sudden damage to your home.

The amount of money you need to save varies. However, many sources recommend saving enough money to cover a minimum of three months worth of expenses.  The thought of saving up that much money might seem overwhelming.

I know that it seemed impossible to me at first. But after some research and planning, it became clear that building an emergency fund is very doable. Below you’ll find a combination of my own methods along with other helpful tips. Read on to see how you can build an emergency savings fund in five months.

1. Take A Second Look At Your Budget

The first thing you need to do is sit down and review your monthly budget and expenses. You’ll want to include everything from your rent/mortgage payment to your grocery bill.

If some of your expenses fluctuate each month, round up when calculating your total. Once you’ve done this, it’s time to “trim the fat”, so to speak. I’ll list some scenarios to get you started.

  • Spend less on TV shows and movies. Hulu without commercials for $11.99 per month. Switch to the plan with commercials that’s only $7.99 per month. That reduces your expenses by $4.00 per month.
  • Reduce your monthly phone bill. Take some time to really go over what you’re paying for. If you don’t use a lot of data, lower your data plan to the next tier. With one major carrier, this saves you $20.00 per month.
  • Find a less expensive laundromat. This expense is easy to overlook; a few quarters seems so trivial. But it all adds up over time, so it’s worth finding a cheaper location. You could save about $5.00 or $10.00 per month.

These ideas may or may not apply to you, but the concept does. With every expense, ask yourself if there’s any way to reduce. There’s a very good chance you’ll lower your monthly expenses, even if it’s just a small change. Put this extra money into your emergency savings fund each month.

Savings Example: Let’s imagine that the first two scenarios above are doable for you. You’ll save $24.00 per month or $120.00 within five months.

2. Set Up Small Automatic Transfers

This was one of the most popular tips I read when I built my emergency savings fund. It seems like an obvious answer. However, it’s easy to write off by saying you can’t afford to do it. Start out with whatever amount you can spare, even if it seems insignificant. I started out by setting up a weekly automatic transfer of $3.00. It’s what I could afford to do, and that’s better than nothing at all.

Of course, you should try to increase the amount whenever you can. Try setting goals for yourself. For example, commit to $3.00 per week for two months. Then move up to $7.00 per week for three months. Little by little, you’ll pad your emergency savings fund.

Savings Example: I’ll use the numbers listed above. Saving $3.00 per week for two months adds up to $24.00. $7.00 per month for three months equals $84.00. This will net you a savings of $108.00 over five months.

3. Pick A Passive/Additional Income Option

The Internet and smartphones make it incredibly easy to earn extra money. There are hundreds of passive income options and many other income options that require minimal effort. You don’t need any special skill set or qualifications to make money. I’ll highlight a few opportunities that we’ve featured on Frugal For Less.

  • 101 Free Money Making Apps: Earn Cash From Your Smartphone – This incredible master list features 101 of the easiest ways to make money. Swagbucks is listed as one example; the author earns about $5 taking surveys for 30 minutes. This is something you could easily do while watching T.V.
  • 50 Legitimate Ways To Make Money From Home – This article has a super diverse list of ways you can earn extra cash without leaving the house. If you dedicate a few hours per week to some of these options, you can earn quite a bit. For example, PointClub is a site where you get paid to complete small surveys. Users report earning $10 – $15 per hour with a $5 sign-up bonus.
  • 17 Freelance Writing Jobs For Beginners – If you’re a native English speaker, consider freelance writing for a few hours per week. I wrote this article myself and personally tried several options listed here. For example, I earned $126.69 my first week on Textbroker with little to no writing experience.

As you can see, there’s an abundance of passive and part-time income opportunities. Swap out 2-3 hours of Internet browsing or channel surfing. Commit 10 hours every week to working online. Do whatever suits your schedule and your preferences; there is truly something for everyone.

Earning Example: I’ll use Swagbucks as an example since it’s so low effort. Spend five hours every week completing surveys and tasks. If you average $5 per 30 minutes, you’ll earn $50 per week or $250 in five months.

4. Reduce Your Monthly Utility Costs

I briefly touched on this topic in another money saving post, but it’s one that’s always worth mentioning. The smallest habits can have a huge impact on your monthly utility bill. By making simple changes here and there, you’ll easily free up money for your emergency fund. Consider this information:

  • An article at tells you how to save 10% a year on your cooling and heating expenses. Do this by turning your thermostat back between 7 and 10 degrees. You only need to do this eight hours per day, but a 24/7 change will save you much more money.
  • Get rid of “phantom energy”. Your home electronics use a startling 75% of their energy when you aren’t even using them. This adds up to 10% of your monthly energy bill. Major examples include computers, TVs, and kitchen appliances. Unplug or turn off these items when you aren’t using them. If you have several electronics in one area, use a power strip for convenience.
  • Air dry your laundry if possible. Drying laundry costs you about $0.45 per load. This seems trivial but adds up fast. If you don’t have a yard for a clothesline, you can still air dry. I purchased two clothing racks for under $10 to use in my two-bedroom apartment. It takes a bit longer but it’s worth it.
  • Invest in thermal curtains or blackout curtains. Blackout curtains can cut down your utility bill by a whopping 25%. These styles do cost more than regular curtains, but they essentially pay for themselves over time. You can also check out this list of energy efficient items that all cost under $50.

These are four ideas to get the ball rolling. Think about the energy you use and your utility bills. Chances are you will find ways to reduce your costs.

Savings Example: In your home, let’s say that you do an average of five loads of laundry per week. Switch to air drying to save $2.25 per week. This adds $9 each month or $45 per five months to your emergency savings fund.

If your monthly electric bill is $200, reduce it by eliminating phantom energy. Reducing your bill by 10% saves you $20 per month or $100 over five months. Simply air drying laundry and getting rid of phantom energy saves you $29 every month and $145 every five months.

5. Get Paid For Your Grocery Receipts

This sounds like an odd tip, but you can profit off of your grocery receipts. There are smartphone apps that you can use to scan your receipts. Once you scan them, you earn cash back. We’ve even got an article about it on Frugal For Less, Top 10 Free Apps That Pay You Money For Scanning Grocery Receipts. Here are some highlights from each app discussed in the article:

  • With Ibotta, you earn up to $1 – $5 cash back on a single product. You can also get a $10 signup bonus.
  • With MobiSave, you get a minimum of $0.50 per item for purchasing select items. You can get a $1 bonus by referring a friend, too.
  • ReceiptPal gives you cash back on any receipt you scan regardless of the items on the receipt.

These are just a few of the 10 examples featured in the article. Use several of them or all of them to maximize your potential. You’re getting 100% free money simply by scanning your receipts. It doesn’t get any easier than that!

Earnings Example: Let’s say you use five of these receipt cash back apps. By doing your regular grocery shopping, you could easily earn $15 per month or $75 over five months.

6. Develop A New Habit For DIY

A lot of my Frugal For Less articles cover do-it-yourself topics. That’s because DIY options are often excellent money savers. For example, you can make a great bottle of all-purpose cleaner for mere pennies. Why pay $5.00 at the store when you have that option? Below I’ll provide some resources for getting into the DIY habit:

  • 35 White Vinegar Uses That Will Save You Money – A Frugal For Less article I wrote about ways to use white vinegar around your home. You can use it in place of more expensive products and save hundreds of dollars each year. Specific amounts of savings are listed throughout the article.
  • 30 Baking Soda Uses That Will Save You Money – This post is similar to the one listed above. It covers 30 unique ways to use baking soda. Categories include cooking, health care, gardening, cleaning, and more. There are also savings comparisons to show how much money you can save.
  • The Very Best DIY Resources, Tips & Supplies – This post provides an awesome list of diverse DIY resources. From how-to guides to must-have items, you’ll find a little bit of everything in this post. It’s a great starting point if you’re unfamiliar with the world of DIY.
  • Instructables – The tagline for this website is ‘how to make anything’, and they aren’t kidding around! This site was originally founded by the MIT Media Lab to share their projects with others. Over the years, this incredible resources has expanded to include instructions and guides for all things DIY. If you want to make something yourself, you’ll likely find the exact information you need here.
  • eHow – We’ve all used Google and typed in “how to” followed by our queries. The top results are often from a site called eHow. As the name suggests, this is a massive how-to site. You can discover how to make everyday items that’ll save you tons of money over time. It’s a personal favorite of mine and boosted my DIY knowledge.
  • 12 DIY Skin Care Recipes For All Skin Types – Another FFL post of mine; I’m a huge fan of skincare and saving money. If you enjoy pampering yourself, you’ll love this post. From face masks to toners, I’ve covered it all. The article features very simple recipes and details about how much money you’ll save with DIY options.

To get the ball rolling, start with some basic items. Take a quick inventory of cleaning products and toiletries you use. Add up the monthly costs. Explore your DIY options. As you begin doing this, it becomes second nature. You can save money without sacrificing, and many DIY projects are fun, too!

Savings Example: Use white vinegar to clean your coffee maker and save about $9.00. Replace your toilet cleaner with it and save $2. Use baking soda to clean your oven and save approximately $4.00. Use it to boost laundry and cut out another $5.50 from your expenses. With these four changes alone, you instantly saved $20.50. Make four changes like this every month and save $102.50 over five months.

7. Never Grocery Shop Without A List

Grocery shopping without a list is something that I simply can not and will not do. This has always been second nature to me; my mom always grocery shopped with a list. Now that I’m an adult, I see why. If you make a list and stick to it, those small impulse buys don’t get to you. It’s so easy to toss a $3.00 item here and there in your cart. But before you know it, you’ve spent $20 more than you planned to. Yikes!

Does the thought of writing a list for each trip overwhelm you? Then just use a pre-made grocery list template. Not sure where to find the lowest prices? Use an app like Flipp, Shop Savvy, or Favado. You get the picture. There are so many resources to make grocery shopping a frugal and simple experience.

I also want to share my personal tip that helps when you’re on a tight budget. Keep your receipts and make a document or spreadsheet of grocery prices. I only shop at one store, so I’ve got a huge spreadsheet that lists prices. It took a few trips to build up, but it’s so worth it. Now I can create my grocery list and know the exact total. You can even use a sales tax calculator to factor that in.

Savings Example: I’ll use a few real, current prices for this scenario. Without a shopping list, perhaps you impulse buy two bags of chips and a box of cereal. The average cost of chips is about $4.40 per bag. A 26.8-ounce box of Kellogg’s Frosted Flakes Cereal is $3.98 at Wal-Mart. Cut out these impulse buys and save $12.78 monthly or $63.90 over five months.

8. Learn To Use Coupons Wisely

I’m a fan of coupons and online discount codes. They’ve helped me save a lot of money over the years. However, I also know that coupon usage can be counterproductive.

My general rule is to only use coupons on items you already planned to buy. For example, you may have canned tomatoes and cereal on your grocery list. Finding coupons for those two items is likely easy and will save you money.

Printing or downloading coupons for things you genuinely need is a great practice. I’ll provide resources for that below. But first, let’s consider the negative side.

In this scenario, you come across coupons for a shaving kit and a new brand of mascara. Sure, it’s tempting to use those coupons. But you weren’t planning to buy them and didn’t need them. So using the coupons wouldn’t really save you money.

You’d be spending extra money just to use a coupon – that makes no sense! Just stick to couponing for items that you need versus going coupon crazy. With that said, here are some great resources for you:

  • – This is one of the most popular websites for printing coupons. Their database is huge and features hundreds of coupons in several categories. You can browse by category to find precisely what you need. Right now, the site lists $609.97 worth of savings.
  • Honey – Honey is a free browser extension that saves you money when you shop online. Honey automatically scans the Internet for coupons in your shopping cart. I’ve used it while shopping on Amazon and got great discounts. Once it’s installed, all the work is done by Honey. You don’t have to hunt down coupons. Talk about convenient savings!
  • 7 Websites That Will Help You Save Money While Shopping Online – This is an article I wrote about excellent money saving websites. They feature digital coupon codes, free shipping deals, cash back deals, price drop alerts, and more. These websites are particularly useful for larger purchases and holiday shopping.
  • 20 Fashion And Beauty Sites That Offer Free Shipping – While these aren’t exactly coupons, this post certainly falls into this category. If you buy fashion and beauty items online, you know that shipping costs can be a pain. This post features 20 sites where shipping is 100% free – no minimum and no strings attached.
  • 25 Companies That Will Send You Free Coupons – The title says it all here! This post features companies that will mail or e-mail you completely free coupons. Some of the companies on the list include Folgers Coffee, Blue Bunny Ice Cream, CoverGirl, L’Oreal Paris, Aleve, Vaseline, and more. Browse this article to get free coupons for brands and products you love.

There are coupons for anything and everything you buy online and in stores. Why pay full price if you don’t have to? Just stick to the simple rule of using coupons wisely. Only use coupons on items you need, and your savings will quickly add up.

Savings Example: Let’s say that an online retailer you like charges $4.99 in shipping. Switch to one of the retailers that offer free shipping. If you order once a month, you save $4.99 per month and $24.95 over five months.

And then get into the habit of using to find coupons for your groceries and toiletries. You may save $20 or more per month or $100 or more over five months. That all adds up to $24.99 per month or $124.95 over five months.

9. Buy Used Items When Possible

When it comes to furniture, I rarely buy anything that’s brand new. My couch cost $12 at a secondhand shop; a bit of cleaning put it in excellent condition. The same applies for chairs, tables, and other items around my home.

Simply put, it just makes sense to buy used items when it’s possible. Here are some resources and stores where you can buy used items in good condition:

Whether it’s furniture or clothing, you can easily purchase high-quality secondhand items. Read the last two resources to discover used must-haves and items to avoid.

Savings Example: It’s difficult to say how much you could save because it depends on your needs and spending habits. Instead, set a goal to cut expenses by $10 per month by buying used. By exploring your used options, you could possibly save $50 over five months.

10. Get Creative With Entertainment

Entertainment expenses can seem tough to tackle. You don’t want to spend a ton of money on movie tickets. But you also don’t want to feel bored in your free time. That’s why getting creative with your entertainment options is a great practice. Here are a few examples:

  • Have a board game night with family and/or friends.
  • Rent free movies and books from your local library.
  • Look at your community calendar for free local activities.
  • Take a free course online.
  • Listen to a podcast while enjoying a cup of wine or coffee.
  • Teach yourself a new hobby like knitting or painting.
  • Join a free fantasy sports league online.
  • Take a picnic lunch to a local park.
  • Explore the active, fun world of geocaching.
  • Learn to meditate or practice yoga.
  • Visit or volunteer at an animal shelter.

Naturally, all of these examples may not apply to you. But the message is clear – free entertainment is always available. Pick options related to your hobbies and passions, and you’re bound to have a great time.

Savings Example: In this scenario, you’re a movie lover who visits the movie theater twice a month. A movie ticket costs $8.84 on average. Let’s say you also spend $12.00 on concessions each visit. Dropping this bi-weekly habit saves you $41.86 per month and $208.40 over five months.

11. Lower Your Transportation Expenses

Transportation expenses are easily one of the biggest money eaters in most budgets. As of right now, gasoline costs a whopping $2.35 per gallon on average. The cost of car insurance typically varies between $100 to $200 per month.

Then there are expenses such as car maintenance. According to AAA, the average cost of driving and maintaining a small sedan is $6,967 per year. It all adds up quickly. Fortunately, there are many different ways to lower your transportation expenses. Here are some examples:

  • Carpool to save money. This can save you up to $600 per year. Coworkers and others may be very happy to carpool since it benefits everyone financially.
  • Walk or ride a bike whenever possible. This is the most simple way to cut down your costs. During pleasant weather, try walking and biking to your destinations. It’s 100% free and it’s healthy, too.
  • Use apps like GasBuddy to find the lowest fuel prices. This app will show you a collection of the most recent gas prices in your area. For example, there’s a $0.13 per gallon difference at the stations in my area. That’s a huge difference! Of course, make sure that you aren’t driving too far out of your way to get lower prices.
  • Learn to take care of basic car maintenance tasks yourself. The article 8 DIY Car Maintenance Tips You Can Handle – Checklist is a great resource. Examples including changing your air filter and brake pads. It’s very easy to learn how to complete these tasks. Why pay for labor when you can take care of it yourself?
  • Try to lower your car insurance rate. Once you’re in the habit of paying a monthly rate, it may not even occur to you to lower it. But it’s always worth a try and you have many options. You can ask your current insurance company about lowering rates. You may also get a discount by bundling insurance such as auto and life insurance. Shopping around is a great idea, too. Even if your rate lowers by $30 or so, that really adds up.
  • Buy discounted gift cards for gas stations. I wrote a post about selling gift cards online; this allows people to buy them for a discounted rate. You can usually get at least three percent or so off the retail value. Sometimes I’ve gotten as much as 10 percent off the retail price. Check out that article to see your options.
  • Explore your public transportation options. A 31-day bus pass costs $50. If you go to and from one destination daily, that equals out to about $0.80 per ride! Look into your local options and prices to see if this can work for you.

When you combine some or all of these tips, your transportation costs can drop drastically. As a plus, all of these tips are pretty risk-free. If it doesn’t work for you, you didn’t incur any big losses. Give these ideas a try!

Savings Example: If you’re able to lower your car insurance rate by $30, you’ll save $30 per month or $150 over five months. That’s a great contribution to your emergency savings fund.

12. Pay Yourself On Pay Day

This sounds a little confusing, but it’s an amazing tip I read awhile ago. Each time you get paid, transfer 50% what was previously in your checking account into your savings account.

For example, you may have $44.00 in your checking account plus the amount of your paycheck. You didn’t use this $44.00, so ‘pay yourself’ $22.00 versus spending it. You may only transfer a mere $5.00 sometimes, but it’s still money for your emergency fund.

This is a beneficial savings practice in general; it really helped me reduce any unnecessary spending. You don’t have to transfer exactly 50% each pay period either; that’s just a minimum to aim for. Sometimes I’ll transfer 100% of my previous checking account balance into my savings.

Savings Example: As I mentioned above, the amount you transfer each month will vary. I just used a random number generator to pick these amounts. Transfer $16.00 in month one, $29.00 in month two, $15.00 in month three, $13.00 in month four, and $23.00 in month five. You saved a total of $96 within five months.

13. Quit/Cut Back On Smoking (Or Other Habits)

I quit smoking cigarettes several years ago for my health. Naturally, this saved me money but the long term savings surprised me. I multiplied the local cost of cigarettes with how many I smoked per day. My state has extremely low tobacco prices and I was a pretty light smoker. I still saved over $500 per year.

If you don’t smoke, you can still apply this logic to other habits. Maybe you spend $5.00 on energy drinks every day. Take a look at your daily routine and see if you’ve got a recurring expense like this. Do a bit of math to see how much you spend in the long run. Reducing your habit or quitting altogether can save you a staggering amount of money.

Savings Example:  Let’s say that you currently smoke one pack of cigarettes per day. The average price of cigarettes is $6.16 per pack. If you quit, you could save $184.80 per month or $924 in five months by quitting. That’s an impressive amount of money!

14. Eat and Prepare Meals At Home

This tip is a personal favorite of mine. Statistics show that Americans spend $1,200 per year on fast food. That’s a big price to pay for food you could make at home. Sure, it may not seem as convenient at first.

But in the long run it saves money, it’s healthier, and it expands your food options. If you aren’t experienced with cooking, that’s okay. Check out these resources:

  • Meal Prep Sunday – You may have heard the term meal prepping; it’s a simple way to stop eating fast food. Meal prepping involves making breakfast, lunch, and dinner dishes in large batches. You make enough for a week or two, so there’s no reason to spend cash on fast food. This is a Reddit resource that covers everything there is to know about meal prepping.
  • 12 Money Saving Meal Ideas To Cut Down On Fast Food Costs – This article I wrote offers 12 meal prep ideas that are substitutes for fast food items. For example, I included a recipe for delicious breakfast burritos along with the cost of a Hardee’s breakfast burrito. If you have a fast food habit, you’ll like this article.
  • 24 Dump Dinners You Can Make In A Crock Pot – Despite the funny name, meal dump recipes are delicious life savers. You meal prep dump dinners and keep them in the freezer. At the start of the day, put them into the slow cooker. When you get home, dinner is ready and waiting for you. It doesn’t get easier than that!
  • 30 Recipes You Should Know How To Cook By The Time You’re 30 – This informative article lists 30 tasty food items with links to recipes. There’s a little bit of everything here, so it’s a great place to start. Once you learn the basics, it’s easy to expand your options from there.

The information above really does make cooking at home a breeze. The hardest part is breaking the habit of grabbing fast food. But once you’re into cooking, you’ll likely enjoy it more and more. In time, skipping out on fast food will become second nature for you.

Savings Example: The data above shows that most people spend $1,200 on fast food yearly. If you cut out fast food altogether, you could save $100 per month or $500 in five months.

Final Thoughts

As you can see, there are numerous ways to build an emergency fund. Within five months, you could save over $3,700 for your fund by following these examples. If your goal is higher, just keep going! Sticking to these practices is a great way to live frugally as your savings account blossoms.

If this article was useful for you, there are a few other Frugal For Less posts you might like. Check out 15 Ways You Might Be Throwing Away Money and 6 Different Ways Procrastination Can Save You Money.

You’ll quickly see that saving money is an easy process. With the right resources, you’ll surely meet your financial goals.

Amy Baum


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