The really really easy way to set up an emergency fund

You’re one giant leap closer to financial awesomeness.

The really really easy way to set up an emergency fund

Well, hello there. You’re looking financially literate today.

The serious bit.

Today I want to take you through the process of setting up your Emergency Fund, step by step. I think my experience was pretty typical of the overall experience, so maybe it’ll be a little easier for you to go through the process if you know exactly what’s coming.

I’ve created, from the very firmament, two easy-to-follow guides to setting up a Money Market Fund. According to very smart people, a money market fund is perfect place to keep your emergency cash. It’s safe, and it offers enough growth to beat inflation, which means you will not LOSE money over time, due to the increasing prices of absolutely everything. In fact, scientists report that the only things not affected by inflation are those telescopes you put coins into at tourist spots. Those are still mostly two rand. I think they need to be audited.

Getting back to the point, guide 1 is for computer-literate people, while guide 2 is for my mom, who is mildly computer-literate, but sometimes prefers step-by-step instructions.

Guide 1: The quickstart process for computer-lovers. 

  1. Go the to the website of your Money Market Fund provider of choice.
  2. Follow the instructions.
  3. Complete the application form in 10 minutes.
  4. Send them the documents they want.
  5. Receive the details for your MMF. Log in and check your account if your provider has that functionality.
  6. Forget about it until you need it.

Guide 2: The step-by-step, blow-by-blow process for setting up a Money Market Fund. 

  1. Choose a Money Market Fund. Most of them will do. The WellSpent editors had a list of the usual suspects in this article. I chose Allan Gray, because I like their advertising. That’s the only reason. For the purposes of this article I’ll explain the process for Allan Gray.
  2. Go to the Allan Gray website.
  3. Click on “Our unit trust funds”.
  4. Click on Money Market Fund.
  5. Click the link “Click here to invest into our unit trusts online”. The link will take you here.
  6. Click Next.
  7. Select the check bubble next to Unit Trusts, and click next.
  8. Click the box next to “Allan Gray Money Market Fund”.
  9. Enter either your lump sum contribution, your monthly contribution, or both. You only need one to start the fund.
  10. A pop-up box appears asking you which “investment channel” you want to take. I chose the left one because it’s simpler, a move that the editors of WellSpent assure me was perfectly fine.
  11. From here onwards I’ll leave it up to you, because it’s just about filling in your details and completing the online process. Let’s catch up again at:

The easiest thing in the world to procrastinate on.

Unfortunately, to seal the deal and open your account, you have to scan or copy some identification stuff, including:

  1. Your signed agreement for the fund itself.
  2. Your ID.
  3. Proof of residence.
  4. Proof of your bank deposit into the Allan Gray bank account.
  5. Bank Statement.

So, if you’re me, the next step is to do everything EXCEPT all that stuff for about two weeks. Then, with a looming deadline, you write half the blog post, and send it to the editors, begging for one day more.

One day later.

Okay, so you’ve finally sent in all your stuff, and Allan Gray very efficiently keeps in touch over email throughout the process.

Once everything is shipshape, they sent you a One Time Pin, which you use to log into their “internet banking” interface. You log in, you get the satisfaction of seeing a hopefully large amount of money in your Money Market Fund, and then you log out and ignore it forever. At least, that’s what I plan to do until I need it. It certainly doesn’t need me to sit there and slowly accumulate cash.

You’re one giant leap closer to financial awesomeness.

Congratulations! Setting up an emergency fund is an extremely adult thing to do, and an important part of your financial wellness puzzle. That wasn’t so hard, was it?

Next up: My experience with financial advisors.


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