The one thing every hip + urban girl should have is an emergency fund. Why? There are tons of reasons why. But here are the reasons I did it:
1) You hate your boss or your job. Think about the crappiest job you have ever had with the meanest and most unreasonable person you have ever worked for. Like 'The Devil Wears Prada' kinda mean. It's time to ditch your job and find a new one. You've done everything in your power to make it work, but the situation is hopeless. It's not just one bad day, it's everyday. Having an emergency fund gives you a cushion to live on, so you can leave the thing that makes you miserable and move the hell on.
2) You get fired or laid-off. Plan on at least six months worth of rent and expenses in your emergency fund so you can get back on your feet and find a new paying gig.
3) Something breaks. Like your car, your house or if something happens to someone in your family. Having money set aside for the crazy things that life throws at you makes a difference. If you need to hop on a plane tomorrow, you won't return to a huge credit card bill.
4) If you're not saving it, you're spending it. Putting aside $100 month off every paycheque means you won't even know it's gone. Don't overwhelm yourself thinking you need to save $5000 right away. Go with small manageable amounts and you'll have a decent savings account in no time.
We hide our money with ING Direct in a Tax Free Savings Account. Meaning, it's just far enough from arm's length - that I have to work extra hard to get it out if I need it. I won't get tempted to spend it, because the money is not attached to my bank card.
Why did we choose ING? Because it's a high-interest account that pays around 2%. Plus, they'll give you a $25 bonus when you open a new account with $100 or more. A Tax-Free Savings Account means you don't pay any income tax on the interest that your money earns. However if you take it out during one calendar year, you'll have to wait until next year to put it back in. BUT - if you haven't been contributing the past three years that the TFSA has been running, you have an allowance space of up to $15,000 to sock away tax-free. Your yearly contribution limit is $5,000 - but you can play catch-up each new calendar year.
Sign-up now using the orange key link to get your free $25 from ING.