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monthly safety net amount into a savings account. While the money may not grow, you can make other investments for that. This money is what you want easily available.

One great feature of almost all major banks is that you can set up an automatic monthly transfer from your checking to savings account.
You can even do this online. So do not delay! Have your allocated safety net amount automatically moved into your savings account. It's wise to do this at the beginning of the month, so its like the money was never yours to spend.

* Take portions of bonuses and contribute them to your safety net.

It's amazing how many people have spent their money on a bonus check before they even see it. It seems the mentality around bonuses is that they are meant to be blown on designer handbags or trips.

There is nothing wrong with a splurge here or there, if you can afford it. However, treat bonuses or other unexpected income like your monthly income, and save at least 5-10% of it.

If you can, it's really wise to put bonus money directly into your safety net. That's a quick way to build it up faster.

* Be true to yourself.

As you can surmise, building a financial safety net is not rocket science. It simply requires planning, determining an amount and moving into savings.

The real challenge, though, for most people is actually committing to such a plan, and avoiding moving funds from their safety net when, for example, they get the urge to join friends on a luxury cruise.

Keep in mind that your monthly goal is to live within your means. If you really want to do this, then you can achieve it. It will require discipline and sacrifice.

But the peace of mind you will have from preparing for hard times is truly priceless. Once you live within your means for a while, and build up a safety net, you will likely agree.

Learn more about this author, Ann E. Smith.
Click here to send this author comments or questions.

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