Life is unpredictable and there will always be some good times as well as bad times and because of that we need to manage our finances in a way that mitigates these downturns. Usually when the times are great we tend to spend everything we have without thinking and saving for a rainy day. But actually we have to create an emergency fund and other savings so that when there is an economic downturn or you manage to loose your job you can support yourself for a while. If you have an emergency fund then you can use that money and don’t need to go into debt when you have some unexpected expenses and later once again save up to replenish that savings account.


In most cases the advice from financial experts is to save up to 3 monthly salaries in your emergency fund as anything less that that could be too little to help you overcome various emergencies. But anything more than 3 salaries usually is an overkill and that money can be better put into a long-time savings account or invested to get some profit. But when you are just starting out creating an emergency fund with one months salary usually seems impossible. That is why I will give you some point how you can do this more easily:

  • Save a portion of your income – The most obvious and the quickest way to create an emergency fund is to simply save money and as soon as you get your income put a portion of it away. This usually is the hardest thing to do because we have planned to spend our money in various ways but it is also the most effective as you can quickly build up that emergency fund. If you manage to save 20% of your income then in 5 months you will have an emergency fund that is in the size of one month income but after 15 months you will have a full 3 month emergency fund.
  • Save pocket change – If you can’t save a portion of your income then one thing that you can do is to simply save all the pocket change that you get in your wallet. If you buy everything with cash then every evening you need to empty your wallet and save all those smaller coins. But if you are using online payments then some banks have a service that rounds every purchase to the next GEL and sends that difference to your savings account.
  • Get a part time job – If you have some spare time then you can get a part time job and quickly earn enough money to create that emergency fund. You don’t need to keep that part time job longer than a few months as you can quickly burn out working that much. But if you set a goal of creating that emergency fund then this can be a great way to do that.
  • Find passive income options – If you have some free time then you should better use it to search for various passive income options not to waste all that time in front of the television or doing meaningless stuff on the internet. You can always create a website, a small business or do some other stuff that can make you some money.
  • Sell your stuff – If you have a lot of stuff that you don’t use then you can create a garage sale or take pictures and put all those things on the internet. This can quickly help you build up your emergency fund and allow you to get rid of some things that you are not using.