How to save for a rainy day

For most people, property may be their most significant investment. Unfortunately, the spending often doesn’t end when you sign on to buy the house. Whether it’s to meet the Healthy Home Standards or fix something cosmetic, home maintenance costs can pop up out of nowhere. Examples include:
 

• Broken windows
• Broken appliances 
• Blocked drain
• Faulty electrics
• Heating or air conditioning repairs
• Septic tank repair.

Are you spending enough on regular home maintenance? Sometimes a proactive instead of reactive approach can be kinder to your wallet. Routine maintenance may mean you don’t need to rely on your rainy day fund as much.

Your car may be your ticket to freedom, but it can also be your ticket to a headache. Like your home, sometimes your car can also serve up costly surprises. Examples of smaller vehicle costs include:
 

• Small accidents or crashes
• Replacing bulbs
• Windscreen chips
• Replacing tyres
• Replacing oil.

A rainy day fund can provide you with a cash injection to cover smaller vehicle costs. Of course, we’re referring to smaller issues where your car isn’t a total write off

Top tip: Don’t forget about those parking tickets. The overdue fines can really add up.

Our furry, feathered and scaly friends may be more like family. But just like family, sometimes pets have accidents and illnesses, including vet bills and unexpected vaccinations. These smaller costs can be covered with the help of a well-stocked rainy day fund.

Sure, we all have planned holidays that we save up for well in advance. The unplanned travel we’re referring to here is not so much a holiday. Sometimes you’ll need to travel without any time to prepare or save. For example:
 

• For a wedding
• An overseas family member becoming ill or passing away
• A new job opportunity.

Travelling can be expensive, especially if you’re heading somewhere far away. A rainy day fund can help pay for upfront costs. 

Similar to travelling for a wedding, sometimes you’ll need to pay for unforeseen gifts. Whether a wedding gift, birthday gift, or present for a newborn, a rainy day fund can allow you to pick out something nice.

The best place to start when planning a budget can be getting a lay of the land. It’s hard to do any form of budget without knowing what you have to work with. The best way to do this can be to get one of your paychecks and look at your net income after tax has been removed.

It may be slightly confronting, but the next step is sitting down and listing all of your outgoings. We’re talking about regular expenses, including your:
 

• Rent
• Mortgage
• Gym membership
• Utilities like power
• Insurance
• Kiwisaver payments.
  

This step can not only help you understand how much money you can spare for a rainy day fund, but it can get you in the right frame of mind to consider possible unexpected expenses.

Now that you know your financial incomings and outgoings, making a budget should be simple. There are a lot of helpful online resources and templates available to assist you. In terms of saving for a rainy day fund, it can be important to ensure enough is left over for regular payments. It shouldn’t have to be too much of your regular income.

You’ve got your budget. Now it’s time to stick to it to reach your financial goals (including your rainy day fund). Life is for living, so you shouldn’t be too hard on yourself. In saying that, there are ways you can help yourself stay on course, including:
 

• Sleeping on big financial decisions (don’t rush)
• Create bank accounts that you can’t touch without contacting your bank
• Lower your overdraft
• Try to buy cheaper alternatives when you can
• Have a strong ‘why’.

There is no bad time to look at your budget, but it can be beneficial to talk with an Independent Financial Adviser to get some support.

Sometimes called income cover, income protection insurance can provide you with a regular monthly income if you can no longer work due to an accident or illness. This money can assist you in maintaining your current lifestyle and meeting financial commitments.

Often called Critical illness insurance, trauma cover can pay you a lump sum if you’re diagnosed with an illness or condition specified in your cover. This money can help you to focus on recovery.