Cash For Emergencies

Most experts on personal finance tend to agree that having ready money by the side in the form of short term savings can be of great use in times of financial crunch. The rationale behind this thinking lies in the fact that emergencies can fall on anyone at anytime and hence it’s good to be equipped well before the crunch situation rolls in. So in case you are looking at ways to manage your short term savings for future then read on as we explore the subject in detail.
Calculative Strategies

It might not sound like a great idea at the beginning but keeping an account of necessary expenditure is one of the basic rules that should be followed in order to manage short term savings. It’s never a bad option to bank enough to be able to cope up in case you are caught up in an emergency. For that it is important to keep a fine record of the monthly expenditure. This can be done by adding up the amount that is usually spent almost every month on your basic necessities like accommodation, meals, clothing, expenditure on kids etc. This can provide a rough idea of the expenditure incurred on some of the most common daily needs.

Apart from these small basic necessities, it’s always good to look into the future to keep a record of the upcoming grand responsibilities that might come your way in the form of a wedding, a function, some kind of renovation work, to mention a few.

Investment Related Measures

Once the calculation of the monthly expenditure and the upcoming grand expenditures is done, it’s time to keep some money aside (apart from the one calculated above) for emergency provisions in the form of some important investment strategies. Most of us are familiar with these strategies but now is the time to give them a serious thought.

Savings account – Savings account is one of the most commonly and widely used method of saving ones money. The returns in this kind of saving are usually low while the money is quickly and easily accessible. So its always easy to withdraw the money from a saving account in times of absolute emergency.

Mutual Funds – These are the special kinds of bonds that are meant for those interested in short term savings and the best part about these funds is that they offer fairly good returns as compared to the savings account.

Certificate of Deposit– Also known as CD, these are the deposits that are accessible at a financial institution or at a bank. The interest rate in these deposits is almost similar to the mutual funds and the interest is payable on a regular basis till the maturity of the deposit. When the certificate of deposit matures, the original amount gets repaid along with the total interest payments.

Apart from these, one of the most attractive avenues for most of the investors nowadays is stock market. Stocks have a successful history of providing great returns to the investors.
Automating the extra credit

For someone who finds it difficult to save, there can be no better option than the automated transfer programs. It’s easy, convenient and regular. The employer can be asked to automatically keep some part of the employees’ salary in the form of a saving that can be of great use in the future. This makes the saving process mandatory because a fixed amount of money goes into the saving account at a regular basis thereby stashing your cash.
These are some of the quick steps that can be easily followed in order to manage ones savings because financial instability is a common situation that can attack any one of us and thus it’s better to be fully equipped to cope up with it than to repent later.