If you have to call 911, it’s never planned. Emergencies tend to take place when we least expect them, which means we normally find ourselves completely unprepared for them – including financially. The money you have in the bank might be sufficient to allow you to live comfortably with the expenses you plan for, but what about the expenses you can’t foresee? For those, you need an emergency fund.
Last year, almost 40% of American adults would not have been able to cover a $400 emergency expense with cash, savings or a quickly repayable credit card charge. It’s fair to assume that figure is higher today.
Regardless of whether we’re facing job losses, home repairs, car troubles, or medical bills, we can shield ourselves financially and from the blows they inflict. Think of an emergency fund like a monetary airbag that you hope you don’t need to use, but you make sure you have one to keep you safe in case of an accident.
There are a number of ways to start and grow your emergency fund, but gold is one of the smartest and most sustainable routes to take. If you’re looking for a long-term economic fallback, here’s why the precious metal is the way forward:
Why you need an emergency fund
Nearly 25 percent of Americans have no emergency savings, though experts recommend that everyone should have a fund to cover living expenses for at least three to nine months. Having this kind of safety net also helps keep your stress levels down, giving you the peace of mind that you’re financially ready if a crisis hits. Financial security and mental health go hand-in-hand, so having an emergency fund is a way of taking care of your wellbeing.
An emergency fund will also help you develop better spending habits. So long as your money is kept in a place that you can only access in a genuine emergency, you’ll learn the discipline of regularly putting aside an amount and being motivated to increase it more and more. By focusing your efforts on the fund, you’ll likely find that you resist spending money on unnecessary items because you’d rather build your savings and enjoy the reassurance that comes with it.
Another plus is that you can avoid bad financial decisions down the line. Having an emergency fund means that you won’t be tempted to access quick, high-interest loans if an unexpected event happens. By saving early on, you’ll have the foundation to bypass risky financial moves and stay financially resilient for good.
How to build an emergency fund with gold
Gold is a historically stable asset – when other markets fluctuate, it is repeatedly turned to as a safe haven and often even rises in price during economic dips. Why? Gold is finite, so it’s rare but still attainable; it’s also durable, so holds its value over time, and unlike fiat currencies, gold isn’t subject to external factors that lessen its worth. For example, gold is not affected by inflation, which dilutes the value of people’s savings year after year.
Using gold for your emergency fund is therefore a savvy way to make your money last longer and go further. In fact, some statistics suggest that saving with gold can be eight times more effective than with fiat currencies.
However, for many people, knowing how to buy, store, and save gold is uncharted territory. Fortunately, in the digital age, there are many simple, low-cost options that are accessible to anyone and everyone.
With the CORO app, for example, you can directly exchange U.S. dollars for gold, starting from as little as $5. The value of your digital wallet always represents an equivalent amount of physical gold, stored in a secure vault. You can add as much or as little gold to your account as you want, and track the value of that gold on a daily basis.
Remember to begin small, and only commit what is financially feasible to your emergency fund. Do a deep-dive of your expenses, identify the areas that can be trimmed back, and calculate a realistic sum that you can afford to put into gold on a regular basis. Once you have this figure, assign a day every month (or week) to make your gold purchases. If you establish this type of routine, you’ll naturally adapt to living without that money and swiftly gain the momentum needed for a substantial emergency fund. You could even make these payments part of your New Year’s resolution, so you have time to organize your budget and then devote 2021 to growing your fund.
We never know when an emergency will happen, but we can make conscious decisions that better protect us and our livelihoods. An emergency fund is a necessary part of everyone’s financial plan and should not be overlooked, no matter how old you are or how much you earn. Acknowledging that is the first step to resilience, and choosing to save with gold will give you an added layer of security, ready for whenever you need it.