How to make ends meet in an emergency

Updated: May. 29, 2020 at 9:56 PM EDT
Email This Link
Share on Pinterest
Share on LinkedIn

LOUISVILLE, Ky. (WAVE) - More people in WAVE Country than ever before have had to apply for unemployment due to the COVID-19 crisis. The global pandemic is a nightmare that no one saw coming, but there is one thing Americans can do that can help take some of the financial strain away in emergencies.

Having a rainy day fund is a common piece of personal finance advice offered by experts, but when you look at the statistics and what folks have or haven’t saved, it seems the advice often falls on deaf ears.

“Often times, people just don’t look at their finances until something comes up,” shared President, Founder and CEO of Marshal Wealth Management James Marshall.

Over 36 million Americans have applied for unemployment benefits due to job loss and the COVID-19 outbreak, which is the highest rate of unemployment the United States has seen since the Great Depression.

“You need to make sure that you can sustain yourself if you don’t get a dollar coming in for at least three to six months,” Marshall declared. “The more difficult it is to replace your job the more reserves you need to have.”

Whatever the unexpected event, the financial answer to the problem is a healthy cash reserve. Adding to your cash reserve is something you do in prosperous times to be able to have a cushion in lean times when money is not as plentiful.

“It’s like air,” Marshall said after with a chuckle. “If you wake up in the morning and you can’t breathe, and you need oxygen, that is cash reserve. Cash reserves are critical.”

If $5,000 is needed per month for a family to survive, that means $15,000 to $30,000 of accessible cash should be in a cash reserve.

Accessible cash should also have no restrictions on it when someone needs to get to it in an emergency. This would be money in a checking account, savings account, money market account, or short-term CD’s.

“Sit down and put pen to paper to what your expenses are,” Marshall explained, “what your income is. What is coming in each month? What is going out.”

Marshall said to calculate every expense, big and small.

“Once you know what your budget is then you know how much you should have in cash reserve,” Marshall stressed.

According to, 28 percent of adults in the U.S. have no emergency savings, 78 percent live paycheck-to-paycheck and only one in four people have a rainy day fund but not enough money to cover three to six months’ worth of living expenses.

“You have to be disciplined, and you have to do it and do it now,” Marshall underlined. “Take action. When you have good solid cash reserves, I tell you, it’s like having a warm coat on in the winter time!”

There is no way to know how long the coronavirus crisis will last, but it is probably safe to say it is not the only problem most families will ever face. Marshall stressed that one thing is sure: It is always best to be prepared as much as you possibly can be.

“You know about the guy named Murphy of Murphy’s Law,” Marshall said with a smirk. “He says, ‘Whatever can go wrong, will go wrong.’”

If anyone has been financially affected by the coronavirus, it may be impossible to start a cash reserve right now; however, anyone can do it once they’re back on their feet.

Marshal Wealth Management has provided a budget questionnaire to get you started on the road to financial security and safety. Read it below:

Marshall Questionnaire 2018 by Shellie Sylvestri on Scribd

Copyright 2020 WAVE 3 News. All rights reserved.