This is timely information consider I wrote this morning about establishing a small emergency fund before taking on the task of accelerating debt payoff. Last week, Liz Pulliam Weston from MSN Money provided details from a summary of different savings studies over the past few years. I discovered this article today.
According to the survey results, having just $500 in the bank corresponded to a large difference in stress, quality of sleep, quality of health, and productivity. The study also shows that income level has nothing to do with this. In both low and moderate income households, the average income for households who have saved at least $500 were about the same as the income for those who had not.
Better health and greater productivity save money in the long run. Even if it doesn’t sound like a good idea to start an emergency fund before directing all of your excess income towards paying off debt on the surface thanks to evaporating savings interest rates, there are many ways a small cash cushion can pay off in the long run.
Want to sleep better? Save $500, Liz Pulliam Weston, MSN Money, March 12, 2009.
Understanding the Emergency Savings Needs of Low and Moderate Income Households [pdf], Stephen Brobeck, Consumerism Federation of America, November 2008.
—
Related Articles at Consumerism Commentary: A Personal Finance Blog Since 2003:
- The Emergency Fund: …
- Twitter Poll: How Much Do You Have in Your Emergency Fund?: …
- Two New Transfers and Other Savings: …
- Your Food Pantry: An Essential Part of Your Emergency Fund: …
- Update: Moving Savings From ING Direct to HSBC Direct: …
Read more of New Study Outlines Importance of an Emergency Fund…
No comments:
Post a Comment