How to Restore Your Emergency Fund After You’ve Used It

It’s rare to find a personal finance expert who will not recommend having an emergency fund. These funds are used to deal with unexpected expenses, but you’ll want to make sure to replenish your emergency fund after using it.

Cut Your Expenses

Saving up three to six months of expenses is a common recommendation that personal finance gurus will give when instructing their listeners regarding an emergency fund. If you have enough money to fund your life for six months, you’re in great shape. However, an emergency will happen at some point in your life. Your transmission might break down. Unless you have a fund set up for a new car, you’ll wind up with a $3,000 expense that you probably didn’t have in your budget. This means you’ll need to dip into your emergency fund.

To replenish a large expense and get back to a fully funded emergency fund, you’ll want to cut your expenses. It’s tempting to relax a bit once you’ve saved up between three and six months of expenses. If you’ve done so, it might pay to call around for some insurance quotes. You might also want to stop some of your subscriptions for a short time. Every dollar you can squeeze out of your budget is a dollar that can go toward building your emergency fund back to a healthy level.

Sell Some Stuff

With the advent of websites like eBay and Amazon, it’s not necessary to keep unneeded items around your home. You can post them online, and someone will likely be willing to buy them. You’ll have to pay a fee to sell your items, but you should be able to bring in a few bucks that can help you replenish your emergency fund to a healthy level.

Bank Any Windfalls

You might have a windfall coming your way. A hefty tax refund is the most common windfall for many people. While you might want to check your withholding to see if you can access this money earlier, a tax refund can help you restore your emergency fund after you have to dip into it. If you have a bonus from your work coming up, it can also serve the same purpose. Avoid the temptation to buy something or go on a vacation when you get a windfall. Put it into your emergency fund. You’ll be happy that you saved it the next time an unexpected expense hit.

Find Additional Work

If you don’t have a side hustle, picking up some additional work can help you speed up the time that’s necessary to reach some of your major financial goals. This could include building up a retirement fund or paying off debt. Taking on a side hustle can also help you fill up your depleted emergency fund. A side hustle might mean taking on a second job in the evenings or on the weekends. It might also mean that you start up a small business mowing yards or providing another service for people. You don’t have to keep it up after you’ve built up some financial security, but a side hustle is one of the best ways to achieve major financial goals on an accelerated timeline.

What If You Don’t Have an Emergency Fund?

If you’ve not yet built up an emergency fund, you’ll want to do your research on alternative options for financing to ensure you are prepared in case of an unexpected emergency. These options might include borrowing from family or friends, relying on credit cards, or applying for monthly installment loans for bad credit. Note that these options are only recommended if you don’t have the savings to cover the unexpected emergency, and you’ll want to pay off any short-term loan that you take as quickly as possible.

An emergency fund is a necessity if you’re looking to avoid financial stress. Once you’ve depleted an emergency fund, you’ll want to build it up as soon as possible to keep your financial house in order.


1 thought on “How to Restore Your Emergency Fund After You’ve Used It

  1. Every body should save some emergency fund for emergency use. I always try save some money for my bad condition. Hope it will support me on emergency.

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