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When constructing a emergency fundit is recommended to set aside enough money to cover at least three to six months of necessary expenses. This ensures that you can cover the essentials if an unexpected life event arises, such as a layoff or short- or long-term disability.

However, it’s not a bad idea to save for more than six months’ worth of expenses, according to financial coach Tanya Taylor. In a recent episode of the Money Glow Up podcast, Taylor shared how a serious car accident and unexpected medical bills for her and her daughter quickly depleted her emergency fund.

Having a year’s worth of necessary finances saved was crucial to his recovery, Taylor said.

“When I had my car accident, I had almost a year’s worth of emergency (funds), and they ran out so quickly because other unexpected things came my way,” Taylor told Tiffany Aliche on Money Glow Up from Yahoo Finance. podcast (see video above or listen below).

After running out of funds that were supposed to last her a year, Taylor had to replenish her emergency fund – and she has some good advice for those struggling to get started.

Start with a budget

For many people who live paycheck to paycheck, the prospect of building an emergency fund can seem nearly impossible. Deciding why you’re saving money is a good motivator early in this process, Taylor said.

“Start with your why: Why are you building your emergency fund? » she said. “Because if you don’t have a why, it’s kind of like, ‘OK, why am I doing this?'”

Learn more: The 4 Best (and Worst) Places to Keep Your Emergency Fund

Taylor recommended creating a budget to start. It’s easier to find extra money you can put toward your emergency fund when you know where your monthly income is going, she said.

“A budget is not supposed to be restrictive,” Taylor said. “A budget is supposed to guide you.”

This may seem daunting at first. But by starting small, you can still work toward creating a safety net for unexpected expenses and situations.

“For some people, when they set that budget, it might be $20 a week, but then they keep finding ways to increase that amount, so it becomes maybe $100 a paycheck,” Taylor continued. “Then you continue to build that over time.”

Set a goal for the emergency fund based on necessary expenses (things you absolutely can’t live without, like housing, food, etc.) and start developing a plan.

Automate deposits

Opening an account – ideally one high yield savings account — because your emergency fund can help you save.

High-yield savings accounts offer more generous interest rates than traditional savings accounts, which can help maximize every ounce of savings as possible.

Learn more: How to Open a High Yield Savings Account: Step-by-Step Instructions

Once there is a designated account to store your emergency fund, it is best to automate deposits and separate your emergency savings from money used for everyday expenses.

“Money that doesn’t fit gets saved,” podcast host Aliche often says, and ensuring that money in your emergency fund isn’t easily accessible will help prevent it from being used for other non-urgent purchases.

Review your budget regularly

Making a budget is one thing, but it must be reviewed regularly to be as effective as possible.

“Once you have that (budgeting) app or spreadsheet, you need to take the time to enter all the information and go back and review it,” Taylor said. “Don’t leave this to chance.”

Reviewing your budget regularly will likely help you find ways to cut unnecessary spending or save extra money – it will all add up.

Although it may seem like a lot of work, it never hurts to be prepared. In Taylor’s case, she learned that it was probably impossible to be overprepared financially.

“I’m just thinking about myself and my financial preparedness,” Taylor said. “But when this accident happened, it was kind of like…I really had to go back to the drawing board.”

Every Thursday, Tiffany Aliche – aka The Budgetnista – shares inspiring money stories to help people achieve financial independence and live richer lives.onThe money shines. You can find more episodes on our video center or watch on your favorite streaming service.

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