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Tick-tock. Hear that?

It’s the countdown clock on the year, and it's reminding us that there are less than six months left before the curtain falls on 2024.

If you’re like most people, you kicked off January with an important resolution on your list — save more money. (It was actually the most popular resolution this year, beating out “exercise more” and “eat healthier” by a wide margin.)

But then life happened. The daily coffee, unexpected expenses, maybe a splurge here and there, and suddenly, it’s July. The resolution? Buried under piles of receipts and flagging motivation.

Or maybe you only recently decided to focus on building up your savings and found your way to this article. Hi! Glad to have you here.

Either way, I have good news.

The year’s not over yet, and that means you still have time. Time to turn things around and build your emergency fund before the curtain comes down on 2024.

Why now? Because, frankly, emergencies don’t care about timing. They just crash in — unexpectedly. And when they do, will you be ready?

According to a recent Bankrate survey, the answer is more likely “no” than “yes.” As of 2023, only 44% of Americans said they could cover a $1,000 emergency using their savings. That's right — more than half of us would have to scramble, borrow, or make tough sacrifices in the face of sudden financial needs.

Why should this matter to you? Because being part of that unprepared majority means sleepless nights and a lot of unnecessary stress. It means that when life inevitably happens, you might find yourself making decisions not based on what’s best for you or your family, but based on what your bank account dictates.

Let’s face it, job layoffs, sudden medical emergencies, a car breakdown... these unexpected events can happen at any time. And they don’t necessarily happen on some regular schedule. I should know; I once experienced all three in the span of six months.

Fortunately, my husband and I had a well-funded emergency savings account. When my prior publisher announced it was closing, I didn’t have to face that sudden job loss with an icy pang of panic. In fact, I had time to reflect on the past few years of my career and find the right position for me.

Imagine having the freedom to focus on solving the problem instead of fretting over the financial fallout. That’s the power of preparedness.

Creating this fund isn’t just about protecting your finances; it’s about reclaiming your peace of mind.

Ready to hustle? Let’s dive into how we’re going to make these next few months count.

1) Set Your Savings Target

According to financial experts, you should have enough money in your emergency savings account to cover three to six months of expenses. This range is recommended because it provides a substantial buffer to handle most unexpected events without derailing your financial stability.

To determine what that number looks like for you, you need to identify your essential expenses and then add up their costs. Start by listing your basic living expenses — things like rent or mortgage, utilities, groceries, transportation, etc. — and how much they cost a month. Once you have your list, add up these costs. This total is your monthly survival budget. For example, if your essentials add up to $3,000/month, that’s your baseline.

Next, decide how many months you want your fund to cover. The number is ultimately up to you and what makes you comfortable. For example, a couple with two incomes and no kids may feel prepared with only three months’ of expenses saved away, since they have another income to fall back on. People who are sole breadwinners, freelancers, or have less stable jobs may want to aim for the full six months to make up for the unpredictability of their income streams. You may also want to pick a number that aligns with your financial risk tolerance level.

Whatever you decide, take that number and multiply it by your total monthly expenses.

That’s your emergency savings target.

So if your essential expenses are $3,000 a month and you want an emergency fund that covers four months of expenses, your savings target is $12,000.

While $12,000 might seem like a daunting figure, it’s absolutely achievable with disciplined saving over the next few months. That’s why we need to break it down into a bite-sized number we can work toward each month.

For example, if your ultimate goal is $12,000, you can save $2,000 a month, and hit your goal in six months, or save $1,000 a month, and get there in a year.

Choose a pace that challenges you without setting you up for failure.

2) Create a Dedicated Savings Account

Now, it’s important to decide where you’re going to put your emergency savings account. You may even want to go ahead and set it up so that you can start immediately transferring money into it. There are a few things to consider when making this choice...

- Keep it separate. You don’t want to accidentally spend your emergency savings fund because you forgot how much of it was hanging out in checking. This also makes it hard to justify touching it, as it feels much more like a “break glass in case of emergency” situation.

- Keep it liquid. The point of this money is that you can trust it will be there when you need it. Don’t set it up in an account that charges a penalty for early withdrawal (like a CD) or put it in the stock market, where you might have to sell at a bad price because you need the money asap.

- Help it grow. Finally, because most emergency savings accounts represent a substantial sum, it would be ideal if it could accrue interest or grow over time.

High-yield savings accounts are ideal because they allow your money to grow through daily interest accruals, usually without charging fees or requiring minimum deposits. For more insights, check out "The Great Savings Switch" article.

3) Assess and Adjust Your Budget

Now that you know your target and you have a place to stash your cash, it’s time to see how much you can afford to save.

Start by looking at your budget. List out where your money is going each month — everything from the morning coffee to the utility bills. This is your spending map, and it’s the first place we’re going to look for money to start putting toward your emergency savings target.

[Don’t have a budget? Check out my step-by-step guide to budgeting backward.]

Here’s where we start making budget adjustments to free up cash for your emergency savings. Because we’re trying to get this done in a little less than six months, we’re going to be a little bit ruthless while trying not to cramp your style too much. Just remember, any tweaks you make are only for the next few months. No one is asking you to give up artisan coffees for the rest of your life. (I would die.)

How and where you adjust your budget depends entirely on you. I’ll give you some good places to start, but what’s non-negotiable for one person is an easy trim for another.

- Savings.Do you already have money in your budget allocated toward another, less necessary savings goal? Start routing some or all of this amount toward building your emergency savings.

- Expenses that can be temporarily shaved without too much pain.Could you pause any subscriptions you rarely use for a few months? Maybe you pay for the Peacock streaming app so you can watch Yellowstone, but it’s still months before the next season comes out. Or you’ve been spending more time outside this summer instead of riding your Peloton. Pause your subscription and put that money toward savings.

- Daily indulgences that add up. This is the stereotypical “how to save money” advice, but that’s because it’s true. When we were working on rebuilding our emergency savings earlier this summer, my husband committed to brown bagging it for a few months (unless a client was paying). The difference between packing his lunch and eating out added up to an easy $100 every week.

- Necessary bills that you can negotiate.Did you know many companies will lower your monthly bill if you ask them? Call your service providers — internet, mobile, even credit card companies — and negotiate better deals. You’d be surprised how much you can save just by asking. If you’re not sure what to say, you can find lots of great scripts for free with a quick search online.

If none of those suggestions work for you, I recommend simply going back through your expenses and labeling them either “need” or “want.” Your needs are non-negotiable, but your wants? That’s where you have flexibility. Decide what’s truly important and what can take a backseat while you’re building your fund.

Once you’ve trimmed your budget back as much as you can reasonably manage, look at how much you now have to put toward your emergency savings each month. How does that number compare to your basic living expenses?

If your monthly savings is more than or about equal to your monthly goal, then fantastic! You should have no problem reaching your goal by 2025.

But not everyone has extra fat to trim in their budget, and that’s okay. There’s still a lot we can do to supercharge how much we’re putting toward our goal every month.

But what if your monthly savings is a lot less than your monthly goal? What if your total emergency savings goal is $10,000, but your monthly salary is only $2,500 and you have $2,000 of necessary expenses?

If that describes you, don’t panic. If you can’t fully fund your emergency savings goal by the end of this year, use this time to build a mini-emergency fund — around $1,000 — to cover any unexpected costs that may crop up while you’re saving for the big target.

This safety net can prevent missed bills due to a low checking account balance and help you avoid costly overdraft fees or growing credit card bills that can keep you from making progress toward your bigger goal.

Even if you don’t have enough (or your budget is too tight) to hit your big target by the end of this year, if you put away just $200 a month between now and December, you’ll hit this goal.

4) Supercharge Your Savings

But spending less isn’t the only way to save more. You can accelerate your progress by adding an extra income stream and earning more money.

Look for ways to bring in extra cash. Freelance in your field, pick up a part-time job, or sell items you no longer need. There’s just one rule…

Every extra dollar you earn should go straight into your emergency fund. It’s temporary, but think of the stability you’re building.

5) Stay the Course

Sticking to your emergency fund goal can be challenging, especially when temptations arise. Here’s how to stay disciplined.

Define What’s a True Emergency:Having clear rules about what qualifies as an emergency and what doesn’t (sorry, flash sales don’t count) helps prevent raids on your fund.

Automate Your Savings:Automation is your best friend in the savings game. Set up an automatic transfer from your checking to your savings account right after each payday. This way, you save without even having to think about it — out of sight, out of mind!

Review and Adjust Regularly:Every month, take a moment to review your budget and your savings progress. If you find you’re consistently saving more than planned, adjust to push yourself a little harder. If life throws a wrench in your plans and you need to scale back, that’s okay too — flexibility is key.

Resist Impulse Withdrawals:It’s easy to dip into your emergency fund for that spontaneous weekend getaway. Don’t. Remind yourself why you started saving. Put a picture in your wallet or a note in your phone to remind you of your goal.

Keep It Fun and Celebrate Your Success:Set milestones and celebrate when you reach them. Challenge yourself to small weekly savings goals, like saving an extra $20 by skipping takeout. Celebrating progress is crucial for maintaining motivation, and small wins keep your motivation high!

6) Crossing the Finish Line

As you approach the end of the year, it’s time to assess the journey and prepare for the future.

Look back at your progress. Did you meet your goal? If so, congratulations! You’re in rare company. If not, how close are you? What has worked well, and what could you improve?

If you had an easy time achieving your goal, consider how you want to go forward. Do you want to save even more? Would that money be better spent investing in the stock market? What other financial goals would you like to achieve?

Lastly, use the habits you’ve developed during this challenge to bolster your overall financial health. Keep budgeting, keep saving, and keep planning for the unexpected.

You started this journey looking for financial security, and now, you’re standing on a foundation that you built yourself. Remember, this fund isn’t just a pool of money — it’s peace of mind, a safety net, and a financial buffer against life’s uncertainties.

Take a moment to appreciate your hard work and resilience. Then, set your sights on what’s next. With your newfound financial savvy, the sky’s the limit.