What to do if the washing machine breaks, the drive belt of the car breaks down or you get a water leak in the kitchen? When something unexpected happens, it’s nice to have a buffer of money to fall back on – a safety net when everything doesn’t go as planned.
A buffer must be readily available
Often placed in a savings account with no charge withdrawals. We recommend that you save two months’ salary. If you are more in the household, you may want to go through the expenses and save one to two monthly salaries per person – especially if you have a shared economy and children.
If you have shared finances with a different and thus ongoing expenses, such as owning a house or having children together, one to two monthly salaries per person may be a suitable buffer.
Consider whether you can cut spending to increase the buffer each month
Consider whether you can cut spending to increase the buffer each month. Review how much you spend on food, clothing, travel and other things.
A good rule is to save 10% of your salary per month. But keep in mind that the amount doesn’t really matter, it’s better to save a little each month than not to save at all. Good Finance has a savings account with good interest rates for this very purpose.
It’s simply money you can spend for some fun
A buffer can have several purposes. It can also be used when you want to do something special, like going away or renovating the house – it’s simply money you can spend for some fun. A safety net when everything doesn’t go as planned.
If you have any questions about how to save for a buffer – or general savings questions, please contact us at spar @ Good Finance. Good luck!