Requirements for our short-term savings

When saving, it is not the same to have a contingency saving ot to have it for our retirement. What we look for our savings are entirely different things.

When saving in order to have some money to cover future contingencies or emergencies of any kind, when you invest those savings, we have to lay down two fundamental characteristics:

Short-term savings

The priority of a short-term savings is that we used to meet contingencies.

These are some of the contingencies to which a person has to face: a gift for a wedding we did not wait, buy a major appliance because we crashed, medical expenses, pour into our home, unexpected rise in car insurance , etc ...

Although generally short-term savings used to save these little unexpected, it is true that in the short term, any person may lose their jobs, causing a lack of income and saving our general plan is impossible to continue .

Therefore, it is advisable to have some money saved for a short period equivalent to 2 or 3 rolls. Why?

How to allocate savings

Once we are clear that saving is important, it's time to get down to work and deliver savings. It is important to remember that the money we save is to spend at different times in our lives, which will allow us to save is to spend without reducing our standard of living.

The first step we must take is, if we have not already done so, save for unforeseen or unexpected expenses (eg car repair, purchase of appliances for damage, home repair, etc ...). It is what we call SHORT-TERM savings. Such savings will allow us to basically two things: