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Buying Time
In the first two steps of Ready for Tomorrow — The Cheapskates Way, we've done something very important. We've stopped guessing. We worked out what the household normally spends. Then we worked out what it would cost to keep the household running in Low-Cost Mode — covering the essentials, reducing what can be reduced and pausing what can wait. That gave us our Minimum Household Number. And now that we know that number, saving for the unexpected suddenly becomes much more meaningful. Because I'm not going to tell you “You need $10,000 in an emergency fund.” For many households, that would be enough to make the whole idea feel impossible before we've even started. Instead, we're going to do this the Cheapskates way. First, buy a little time. Then buy some more.
We're Not Really Saving Money
Of course we're putting money aside. But I want us to think about what that money actually does for us. It buys time. Suppose household income drops unexpectedly. If there is no spare cash at all, decisions have to be made immediately. What can we put on the credit card? What bill can we delay? What can we sell? Who can we borrow from? What do we stop paying? That is an awful lot of pressure to deal with at the same time as whatever caused the income drop in the first place. But imagine the same situation and the household has enough cash set aside to cover one week's minimum expenses. Now we have seven days. Seven days to find out what's happening. Seven days to make phone calls. Seven days to review options. Seven days to rearrange the budget. Seven days when we aren't immediately forced into debt. That one week's buffer may not solve the problem. But it gives us time to start solving it. And that's valuable. Start With $250 If you have no financial buffer at all right now, don't start by staring at a target of several thousand dollars. Start with $250. Why $250? Because it's enough to make a difference. It may cover:
It isn't supposed to. It's the first layer. Your first little bit of breathing room. If even $250 feels difficult, break that down too. $10. $20. $25. Keep going. There is no rule saying an emergency buffer needs to appear overnight. Then Buy One Week Once you have that first $250, your next goal is: One week's minimum household expenses. This is where knowing your Minimum Household Number becomes so useful. Suppose your minimum monthly household spending is: $3,600. For a simple working figure, one week is roughly: $830. Now your goal isn't: “We need thousands and thousands of dollars.” It's: “We're working towards $830 so we've bought one week.” That sounds much more achievable. And when you reach it, you've done something significant. You have given your household seven days of options. Then Buy Two Weeks After one week, aim for two. In our example: One week: approximately $830 Two weeks: approximately $1,660 Now imagine what two weeks could mean if work suddenly stops or income falls. You aren't sitting at the kitchen table on Day 2 wondering which credit card has room. You have time to work through the situation. The pantry can help. Low-Cost Mode can help. Reduced bills can help. And now cash is helping too. This is why each part of Ready for Tomorrow works with the others. Nothing stands alone. Then Buy One Month Once you reach two weeks, the next milestone is: One month. And here's the important bit. Your target is based on your Minimum Household Number, not your normal spending. If your household normally spends $5,200 a month but can operate sensibly in Low-Cost Mode for $3,850, then your first one-month buffer target is: $3,850. Not $5,200. That is one of the reasons we did the work in Steps 1 and 2 first. We've made the savings goal reflect the household we would actually run if income dropped. And every recurring expense you reduced in Step 2 made this target smaller. That's another way those big-bill savings keep working for you. What Happens After One Month? Once you've built one month, you can decide what comes next. Perhaps you want:
A single-income household may want a larger buffer. Someone who is self-employed may prefer more. A household with very secure income may be comfortable with less. Your debts, health costs, job security, family responsibilities and other circumstances will all influence what feels appropriate. But one month is a wonderful first substantial goal. Because by then you've stopped having only a little emergency money. You've built a genuine time buffer. Don't Wait for “Spare Money” One of the traps with saving is waiting until there's money left over. Often there isn't. Life has a remarkable ability to spend whatever is available. So give the buffer a job in the budget. It doesn't need to be a huge amount. Perhaps: $5 a week. $10 a week. $25 a fortnight. Whatever is manageable. Then add extra money whenever it appears. Use Found Money Found money is perfect for Buying Time. Things such as:
Instead of letting that $70 disappear into ordinary spending, send it straight to your buffer. You've already been living without it. Now it can buy you time. That is one of the easiest ways to grow this fund without feeling as though you're constantly cutting something else. Keep the Buffer Separate Your financial buffer needs to be easy enough to access when genuinely needed, but not so easy that it quietly turns into ordinary spending money. You may choose:
What matters is that you know: This money has one job. To buy us time when circumstances change. It isn't holiday money. It isn't sale-shopping money. It isn't “there's a bargain and we can replace it later” money. If you use it for a genuine need, that's fine. That's what it's there for. Then rebuild it. Keep Some Emergency Cash at Home Most of us now rely heavily on cards, EFTPOS, phones and online banking. Most of the time that's wonderfully convenient. But temporary payment-system or power outages do happen. So part of your Ready for Tomorrow financial planning should include a small, sensible amount of cash at home. Not thousands of dollars. Not your entire financial buffer. Just enough that you could buy basic necessities if electronic payments were temporarily unavailable. Smaller denominations are useful. How much you keep is entirely up to your household. Think about what you might reasonably need for:
Know Which Bills Must Keep Being Paid Your financial buffer becomes even more useful when you already know which bills have priority. This is why we're adding a: Bills That Must Keep Being Paid Sheet List your essential commitments. For example:
What is it? How much is it? When is it due? How is it normally paid? Then if income drops, you don't have to search through bank statements trying to remember what's coming. You already know. Know Where Your Financial Information Is Another part of being Ready for Tomorrow is simply being organised. If something happened and another member of the household suddenly needed to handle the finances, could they? Do they know:
But there is one very important rule: Do not put PINs or full online banking passwords in your Ready for Tomorrow Binder. The binder is there to help you locate information. It should not become a convenient collection of everything someone would need to access your accounts. Instead, record things such as: Institution Account purpose Contact details Where secure login information is stored Where important documents can be found Keep sensitive login information securely stored elsewhere. Prepare a Financial Hardship Contact Page This is another page I hope you never need. But if you do need it, you will be glad it's already there. Create a simple list of contacts for:
The purpose is simple. If something changes, you don't want to spend the first stressful afternoon hunting for phone numbers. The information is already in the binder. Ask for Help Early If a significant income drop means you may struggle to meet essential commitments, it is generally better to contact providers before bills become seriously overdue. Explain the situation. Ask what hardship options may be available. You may be able to negotiate:
Again: Time creates choices.
Don't Keep Too Much Cash While Carrying Expensive Debt Without Thinking It Through
Ready for Tomorrow is about becoming debt free, cashed up and laughing. So we don't want to blindly pile up large amounts of savings while paying very high interest unnecessarily. There can be a balance. A small emergency buffer can help stop you reaching for the credit card every time life happens. Once that first buffer exists, you may choose to balance additional savings with faster debt reduction. Because clearing debt also strengthens the household. Every debt repayment that disappears permanently lowers your Minimum Household Number. And that means every future dollar in your buffer lasts longer. Your Pantry Is Still Part of the Financial Buffer Don't forget what we've already built. Money in the bank isn't the only thing helping you through a financial shock. Food in the pantry is part of the plan. Household supplies are part of the plan. Low bills are part of the plan. Useful skills are part of the plan. Imagine two households each have $2,000 in cash savings. Household A needs $1,000 immediately for groceries and household supplies because there is very little at home. Household B has useful pantry food and everyday supplies already bought and paid for. The same $2,000 cash buffer may last Household B considerably longer. That's why Ready for Tomorrow isn't simply a savings challenge. We're building several layers of protection that work together. A Buffer Is There to Be Used Sometimes people become so attached to having an emergency fund that they are afraid to use it. If a genuine household emergency happens, use it. That is its job. If the car needs an essential repair and the alternative is borrowing at high interest, that may be exactly why you built the buffer. If an income interruption occurs, use the buffer according to your plan. Then, when circumstances improve: rebuild it. A buffer isn't a trophy. It's a working household tool. Your Buying Time Milestones Let's keep this simple. Write down these milestones: Milestone 1 — $250 My target date: ___________________ Milestone 2 — One Week of Minimum Household Expenses My amount: $____________________ Milestone 3 — Two Weeks My amount: $____________________ Milestone 4 — One Month My amount: $____________________ Milestone 5 — Our Longer-Term Goal Our goal: _______________________ Our amount: $____________________ You don't need to complete them all this year. You simply need to know what you're working towards. Weekly Buying Time Tracker Use this simple table to record what you add to your household buffer each week. The amount does not need to be large. What matters is building the habit and watching your buffer grow.
Ideas for “Where It Came From” You might record:
Perhaps: One day Three days One week Two weeks Seeing the money translated into time makes the progress much more meaningful. At the End of Eight Weeks Total added to our buffer: $____________ Our current buffer total: $____________ Our Minimum Household Number: $____________ Approximate time we have now bought: ______________________ Our next milestone: ______________________ This Week's Ready for Tomorrow Action This week, I want you to do five things. 1. Confirm your Minimum Household Number. Bring forward the number you calculated in Steps 1 and 2. 2. Work out one week's minimum expenses. Write that number down. 3. Check the buffer you already have. You may already be further along than you think. 4. Choose your next milestone. Is it: $250? One week? Two weeks? One month? 5. Decide how you'll fund it. Perhaps: $10 a week. $20 a fortnight. Savings from reduced bills. Money from selling unused things. Whatever suits your household. Then start. Your Step 3 Downloads Use these Ready for Tomorrow pages with this week's story. Buying Time — My Household Buffer Tracker This is your main Step 3 worksheet. Use it to work through the milestones: $250 → One Week → Two Weeks → One Month → Longer Keep it in your Ready for Tomorrow Binder so you can see your progress building. Emergency Cash-at-Home Planner Decide whether your household wants a small cash reserve, how much is sensible and what it would be used for. Bills That Must Keep Being Paid Create a quick reference for the essential household bills that need protecting if income drops. Where Our Financial Information Is Kept Record where important financial records can be found without putting sensitive passwords or PINs into the binder. Financial Hardship Contacts Keep important provider and assistance contacts together so you don't need to search for them during a stressful situation. How Much Time Have You Bought? Keep coming back to that question. When you have $250: What could that handle? When you have one week's expenses: What decisions could wait seven days? When you have two weeks: What options would that give you? When you eventually have a month: How differently would you feel if household income suddenly changed? That's why I prefer to think of this as Buying Time rather than simply building an emergency fund. We're not collecting money just to watch a number grow. We're buying:
Every small thing you do today to make your household stronger gives your future self more choices. A dollar at a time. A bill at a time. A week at a time. Calmly. Gently. Consistently. The Cheapskates Way.
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