What’s an ‘unexpected cost’?
There are many unexpected or emergency costs that a person may need to deal with, such as:
- Car breakdown costs
- A sudden loss of income through unemployment or illness
- Splitting up with your partner and taking on more living costs once they leave
- Emergency dental work
These expenses become an emergency when you’re unable to delay payment on them. For example, if you need your car to get to work, you mightn’t be able to avoid paying for expensive repairs. Not having a car could put your job at risk or mean further losses of income.
How can I start a savings fund if I'm on a limited income?
When you have debt, saving money might be really difficult. This is understandable, especially if you’re on a limited income. However, any amount of money you can put aside will add up over time.
You’ll need to allow time for your savings to build up. Don’t put pressure on yourself to have a ‘full savings pot’ by next week or next month. This probably isn’t realistic and putting such pressure on yourself isn’t going to help.