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In my opinion the first building block of being a bad bitch is financial independence. There’s no better freedom than being able to leave a situation without fear because you know your bank account is looking right regardless of a job, relationship, or whatever may come in life. At the end of a day a bad bitch has her own back! This is why I named my emergency savings account my #badbitch account.

So what is an Emergency Savings Account exactly? It’s a high interest savings account (with ATLEAST 1.00% APY or higher) that has anywhere from 6-12 months of your living expenses stashed away.

Here are some high interest banks that I use and highly recommend:

You can also checkout this article on Nerdwallet or this article on Magnify Money for a list of high interest savings accounts.

In order to have a comfortable cushion I recommend having 6-12 months of living your expenses stashed away. This way in case the worst happens (i.e. you get laid off, have an unexpected injury, or need to leave a toxic situation) you have solid financial cushion and no money worries.

When calculating 6-12 months of think rent, minimum debt payments, minimum transportation costs, and minimum food expenses.

Let’s use me as an example. Here’s how I calculated exactly how much money I need stashed away in my #badbitch account: $1,300 (rent) + $300 (monthly bills) + $130 (NYC Subway) + $300 (food) = $2,030 per month.

Now take that monthly balance and multiply it by 6 = $12,180

And multiply that number by 2 = $24,360

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This means my emergency savings account should be somewhere between $12,180 – $24,360 at all times. A huge part of financial wellness is knowing your numbers! So if you don’t know exactly how much you need in your emergency saving account take a moment and figure it out now 🙂

Formula here:

Rent/Mortgage + Minimum Monthly Debt Payments + Minimum Transportation Costs + Minimum Food Cost = 1 Month of Bare Living Expenses

1 Month Of Bare Living Expenses x 6 = Minimum

1 Month Of Bare Living Expenses x 12 = Maximum

After you hit 12 months of living expenses in the bank it would be best to start investing your money if you feel comfortable doing so

Now if this number seems daunting to you, don’t worry – it should! It’s approximately how much money you spend in a year. Of course it’s big! But don’t worry. It’s never too late to start saving and as long as you keep it up you will get there eventually.

Any questions? Feel free to leave a comment below or slide into my DMs on instagram!

Check out my latest posts here:

Let’s Close Our April 2020 Budgets Together

3 Things You Should Know About 401(K)s

I Spent HOW Much on Groceries? Money Diary

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Thank you for reading! Make sure you follow this blog so you never miss a post. You can also join the girl gang on Instagram @HighBlackGirl and Youtube @Nnekaxoxo


Posted by:High Black Girl

3 replies on “You Need An Emergency Savings Account STAT!

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