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Are YOU one of the 46%?

Posted by Benjamin Coakley on Tue, Oct 16, 2018 @ 09:20 AM


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A WaypointRx Company 

Did you know that only 46% of Americans have a rainy-day fund? Not only that, but according to the Associated Press – NORC Center for Public Affairs, two-thirds of Americans would struggle to scrounge up $1,000 in an emergency. If you are one of the 54% of Americans who do not have a rainy day fund, you leave yourself vulnerable to the unexpected run the risk of falling faster into debt. 


Rain on umbrella

Below are the top three reasons why you should have a rainy-day fund:

  1. It’s important to have a rainy-day fund because rain ALWAYS comes. Whether it is in the form of a new air condition, new car, healthcare expenses or any other unexpected emergency. No one is immune to the unexpected, and sooner or later it happens to us all. By having savings set aside, you will be prepared for the unexpected.
  2. It helps keep you on track by forcing you to regularly reevaluate your budget. All of the top experts and studies have shown that it is best to have between 3-6 months worth of expenses saved in your rainy-day fund. Make sure you have what you need by regularly updating yourself with your monthly expenses. 
  3. It gives you peace of mind. By having a rainy-day fund, it helps keep your mind at ease, and reduces your stress and blood pressure levels, should the unexpected happen. Life is stressful enough, ease some of the worry and burden by giving yourself the gift of peace of mind when it comes to your finances. 

In our experience, there are a few common mistakes that people tend to fall in to when the need for a rainy-day fund arises:

  1. Using credit cards or retirement accounts as an emergency fund and simply paying the minimums.
    This is a BIG mistake for several reasons. For starters, paying just the minimum on your credit card balance means you'll pay more in interest. In fact, the average household with credit card debt pays a total of $1,292 in credit card interest per year, according to NerdWallet. Additionally, if you don’t pay it off every month, it can extend the time it takes you to get back to debt free.
    As for using retirement accounts, not only will you typically be hit with penalties for pulling out prior to your 59 ½ birthday, but you are robbing yourself of all the compound interest you would have accrued had you left the money where it is.

  2. Not putting the rainy-day fund into a separate account.
    If you keep it all in one account, you run the risk of thinking you have more than you do and dipping into your savings unnecessarily. To make the process easier, consider setting up automatic transfers to ensure you are regularly contributing to your savings. It is also important that you don’t invest your emergency fund. It can be tempting to take that money that is sitting there and put it into something with a higher return, but by doing so, you open yourself up to a lot of risk. The point of a rainy-day fund is stability and peace of mind.

  3. Using the rainy-day fund for non-emergencies.
    Having a rainy-day fund requires a regular practice in self-control. Things such as the latest gadget, holiday expenses, and back-to-school shopping should not count as emergencies. True emergencies are the unforeseen things such as unemployment, unexpected car or home repairs, or medical emergencies.

Saving for a rainy-day fund might not be more difficult for those who live paycheck to paycheck. We all struggle with finding ways to save, but the good news is – it is possible for everyone. Below are some steps to get you started:


  • Develop a financial plan.
    Lay out where you want to be financially in the next 6 months, 1, 3, 5 and 10 years. Having it written down will make it easier to stick to. Include how and when you will pay off any debts currently accumulated. Make sure you also know how much you pay each month on your expenses to help determine how much is needed for your rainy-day savings account.
  • Pay off your debts.
    Download the debt reduction tool if you need help figuring this one out. Remember to always pay your minimums to avoid accumulating more debt with a missed payment. Consider auto-payments whenever possible to help ensure you don’t miss any.
  • Reduce unnecessary expenditures.
    We all have a lifestyle that we have grown accustomed to, so dive into your personal spending habits to see where you can cut costs. Whether it is eating out less, making your coffee at home, seeing one less movie a month, or whatever you find takes up your money – start reducing your expenditures to help you save up faster.
  • Start your rainy-day savings account.
    Once you have determined what your monthly expenses are and have a play for paying off your debts, start your rainy-day savings account at your bank. Start with what you can and slowly build it up to having 6 months’ worth of expenses saved. Avoid withdrawing any of that money until you have 3 months’ worth of expenses saved – that is unless you absolutely need it.

By having a rainy-day fund, you give yourself a buffer to keep yourself afloat in times of need without having to rely on taking out a loan or putting it on credit cards. The best way to get out of debt is to give yourself a way to not fall into it further.


Download our FREE tool that helps you develop a financial plan. Also, be sure to listen to our webinars on Establishing a Game Plan, and Getting Out of Debt. 


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 We also recommend checking out this video from our advisor Ben on 4 ways to improve your cash flow.

For more information, click the button below and set up an appointment with one of our advisors. 

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We also recommend you visit and check out our free webinar on Establishing A Game Plan for additional tips and tricks for finding and following your financial goals.

At WaypointRx & Pharmacist Financial, we take pride in helping pharmacy owners & staff pharmacists reach financial goals, make educated decisions, & develop financial plans that work best for their unique needs. Over the years we have helped hundreds of pharmacists enjoy inspired independence by achieving greater personal and financial success. As we begin each relationship, we invest a lot of time and effort in the discovery and clarification of each pharmacist’s unique situation and, most importantly, their financial goals.

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Topics: preparedness, saving money, Video, Blog, pharmacist financial, financial concepts, rainy-day