SKIP THE COFFEE SHOP
Your morning coffee might seem like a necessity, but it might be time to say adios to the artisan Americano and hello to the humble homemade heavy-roast. The couple dollars, sometimes as much as $6, you spend on drinks at the coffee shop add up, and these funds would be better delegated to an emergency account.
SUPPLEMENT WITH LOW-RISK INVESTMENTS
If you’re playing the long game, invest in some low-risk investments such as CDs or high-rated bonds. While these investments won’t return much money in interest, holdings such as bonds take years, maybe even decades to mature, so they provide guaranteed income for the future that can’t be touched on a whim.
In theory, investing in an emergency fund for the future makes sense, but it does you no good if unexpected costs occur today. It’s a good idea to keep some money in liquid assets such as a savings account or cold, hard, cash. While something like a CD will return more on interest, there are significant financial penalties for withdrawing early, and therefore does you no good in the event of an emergency. Be sure to balance future income with liquid assets.