Your Money, Your Goals - A financial empowerment toolkit for social services programs.

MODULE 7:

Saving for the unexpected,

emergencies, and goals

What is savings?

Savings is money you set aside today to use in the future. People save for many reasons. Two big
reasons they save are for:

 Unexpected expenses and emergencies

 Their own goals, like a new TV, appliances, a home, their children’s education, and

retirement

Why save for unexpected expenses and emergencies? Because they will happen.

Everyone has unexpected expenses and emergencies—this could be a suddenly needed car
repair, the need to travel to help a sick family member in another state, a cutback in hours or
even the loss of a job.

When you save for unexpected expenses and emergencies in advance, you can handle them
when they happen without having to skip paying your other bills or borrow money. Saving will
help you save the additional costs of being late on bills or borrowing to cover those extra costs
that can make it harder to reach your goals.

When you skip paying other bills to pay for an emergency, you often pay late fees. And if it
results in loss of service (your utilities are shut off, for example), then you have to come up with
more money to turn them back on.

When you borrow money, you have to pay fees and sometimes interest. And on top of that, you
will have to use some of your income going forward to pay back the money you borrow.