No matter what your income is, you must regularly set aside a portion of your salary to nurture an emergency fund. This fund acts as a safety net in times of crisis and helps you become self-sufficient and independent as well. Ideally, this emergency fund must have money to help you ride through your regular expenses for at least five to six months. 

The thing is, emergencies often come unannounced and are usually accompanies by financial emergencies as well. Such emergencies often force people to take hasty and poorly-thought financial decisions that prove to be detrimental in the long run. For instance, in today’s volatile world, you never know when you might be given the pink slip or a sudden change in the government policy renders your business obsolete.

Similarly, you might need access to instant cash to say, if your roof starts leaking in the rains or if there’s a financial emergency in the family. In such situations, if you don’t have an emergency fund to rely on, the going can get tougher than usual. 

The unfortunate thing is that not many people build emergency funds, and if you have one, you are already ahead in the game. However, even if you have started a fund, it is essential to continually nurture it—particularly if you recently used up a portion of the same—and contribute to it regularly.

8 Ways to Enhance Your Savings and Rebuild Emergency Fund after a Crisis

8 Ways to Enhance Your Savings and Rebuild Emergency Fund after a Crisis

  1. Cut down on unnecessary expenses
  2. Make use of Windfalls
  3. Recalibrate other financial goals
  4. Find ways to earn some extra cash
  5. Recycle and sell
  6. Cut down on one major expense
  7. Rework your budget
  8. Save on Utilities

Here are a few tips to help rebuild a depleted emergency fund:

  • Cut down on unnecessary expenses

There are several non-essential expenses that we incur daily; these include buying unnecessary luxury products (like scented candles, designer soaps or potpourri), eating out frequently, splurging on expensive clothes, etc. All these expenses need to be reduced or eliminated when you are trying to rebuild your emergency fund. 

Cutting back on peripheral expenses is a great way to rebuild your emergency fund or save up to repay a debt. However, it is also essential that you don’t become a miser and spend a limited amount of money on the things that you like and have some fun. If you do not do this, you may get burned out of your monotonous lifestyle.

  • Make use of Windfalls

Instead of using the tax refund to make a down payment on a vehicle, use the extra funds to restock your savings for emergencies. Tax refunds are not the only windfalls you may get in the year. Several companies give bonuses on a quarterly or yearly basis. If you are one of those, you can use the bonus amount to rebuild your safety net. Employees get paid extra even when they work overtime or sometimes when their project over-performs as well. This extra money should be used to restock the emergency fund. What’s more, remember to collect all the cash you get on festivals and use it to replenish your emergency fund. 

  • Recalibrate other financial goals

If you do not have a safety net for the next time when you might need to spend for an emergency, you could end up in a lot of trouble. You risk incurring a high debt on your credit card, you missing payments and sending your monthly finances in disarray.

Thus, if you are saving up for your emergency fund, put on hold other goals like going on a vacation, buying an expensive electronic product, improving your home, or any other such short term goal. Funnel all this extra saved up cash towards rebuilding your emergency fund. Once you have enough funds for an emergency, you can go back to saving for other expenses.

  • Find ways to earn some extra cash

The thing about emergencies is that you never know when one is around the corner. Thus, you need to find ways to continually build and restock your emergency fund, especially if you have just taken out a part of it. You can take up a part-time job, undertake freelance assignments, or work from home during the hours you are free from your regular job. Similarly, you can provide coaching lessons or do small tasks for your friends and family in exchange for small sums of money. This way, you can slowly rebuild your emergency fund from the money earned from these gigs. 



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  • Recycle and sell 

Unless you are a staunch minimalist, you may own several things in your house which you no longer use or need. You can be proactive and collect these items and can try reselling them online. There is a huge market for refurbished and used products online, and people are usually willing to pay the asking price for the same. 

Avoid doing this in a hurry as then you may not be able to negotiate appropriately. There are several platforms, websites, and apps which help people meet potential buyers of their products and help them strike a deal. Simply search for a website that you think suits your needs and post the products you want to sell.  Whatever money you are successful in earning can be saved for future emergencies.

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  • Cut down on one major expense

Once you have knocked out all the non-essential items which you need not purchase, you should next look into the categories where a significant chunk of your monthly salary is being spent. Prioritise these big-ticket expenses and see if you can find a replacement or curtail it. For example, if you are spending a fortune on fuel, try to limit using your car.

Similarly, if you have enrolled for a high-end gym membership that you haven’t used in months, cancel it. On similar lines, if you have been ordering overpriced food from restaurants every day, make it a point to cook at least one meal yourself every day. These might seem like small and insignificant steps, but they can save you a fortune.

Remember, it may seem impossible to cut off the expenses of such major categories completely, but you can at least lower the amount you spend every month on such things.

  • Rework your budget

It would be helpful if you reworked your budget for a few months in order to boost your emergency fund. Be more mindful of what your expenses are and where you can save more. Use mobile apps to keep track of how frequently you are swiping your cards and set an upper limit on your monthly budget. Avoid a few products and services, or hosting any parties until you are sure that your emergency fund is back on track. Reworking your budget will give you a chance to make the necessary changes to your lifestyle in order to save more money. What’s more, you can adopt some useful lessons from this exercise as a permanent feature of your budget in the future as well. 

  • Save on Utilities

The two recurring expenses that every household must incur every month are bills and groceries. However, unknowingly you may be spending way too much on utilities every month. Moreover, many times, there are ways to cut back on these as well. If you have a habit of wasting too much water, electricity, etc., you are essentially pouring money down the drain. Similarly, you could have signed up for channels or streaming websites that you don’t even view anymore. Being more mindful about the consumption of these resources can cut down on your utility bills significantly. 

Be a little more vigilant the next time you keep the tap running while you are brushing, when you are leaving the light on in a place when nobody’s at home, paying for channels which you do not even watch, etc. Take stock of what you use, as opposed to what you pay for. Additionally, keep an eye out for offers and discounts from big retailers on groceries and staples. Most retailers regularly offer coupons, combo deals, and seasonal discounts to attract customers and if you plan your budget smartly, you can save a lot of money as well. 

All said and done; it is important to maintain a healthy emergency fund with optimum levels at all times. This is all the more important after your emergency fund has witnessed a decline after a recent crisis. It might seem intimidating at first, but a few simple and smart decisions can help you get back on track in no time. 

A few ways to go about rebuilding your emergency funds are mentioned above. These tips and tricks can be useful when you are trying to accumulate funds for emergency use. It would help if think about the entire process as something which you have already been successful at doing, and you need to push a little bit harder to do it once again. It is crucial to rebuild your emergency fund as a crisis may crop up at any time without any notice, and having these funds can help you through difficult times. It’s always better to be self-sufficient and have enough in savings than to stress about the finances when a crisis strikes.

Shivam Abrol

Shivam is a passionate content writer with Masters in journalism. A mutiple-award-winning writer, he brings over a decade of experience as a BFSI writer. In fact, he himself is known in his circle for sound financial advice. A writer by day and a reader by night, Shivam enjoys researching and writing on various financial topics, including credit, stock market, crypto, taxes etc. When he is not spending his time penning down an informative article or opinion, he can be found playing with his kids or collecting stamps.

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