It is nice to have buffer room in your budget or savings account.
Sometimes things pop up or life gets busy.
Other times there are special or once in a lifetime occasions.
There could even be a one time sale that is too good to pass up.
If you don’t have that buffer, things probably won’t go over very smoothly.
A Buffer Helps Relieve Stress
If you have no buffer in the bank or your monthly budget, the lack of money can cause a ton of stress when something unexpected or bad pops up.
Whether it is a flat tire or a last minute weekend trip to visit a sick relative, if you have no buffer your stress level will be through the roof even more than it would be normally in a bad situation.
Luckily, even a small cash buffer could allow you to avoid the stress of trying to round up some money at the last minute.
You won’t have to go beg friends or family to lend you money. You won’t have to turn to your credit cards either, which will likely put you in debt at a high interest rate.
A Buffer Allows You To Take Advantage Of Opportunities
The same buffer that will allow you to get through the bad times can help you out when a can’t miss opportunity throws itself at you. Your neighbor might have an awesome sofa that you’ve always wanted but it was way out of your price range.
If you find out your neighbor is moving to another country and is selling all of their furniture for rock bottom prices, you’ll wish you had that buffer. It’d be a perfect time to pick up that awesome couch at a reasonable price, but if you don’t have the money you’ll miss out.
Otherwise, you could get stuck trying to get interest free furniture financing which I believe is a bad idea.
A Buffer Helps You Enjoy The Moment
While some people think saving sacrifices living in the now, it can be argued that it actually allows you to be able to live in the moment more than those with no savings.
You may have to sacrifice a bit in the present when nothing special is going on, but building that buffer will allow you to enjoy those once in a lifetime moments to the fullest.
Whether you’re on a one time trip to an exotic location, graduating from college or getting married, having that buffer will allow you to be able to think a little bit less about money when an opportunity for a splurge pops up.
As long as you know your limits, you can spend within reason without having to worry about how you’re going to have to pay off a small splurge on an already planned for event.
It’d be a major bummer to be in Paris, but not have the money to go up the Eiffel Tower like you have been dreaming about for your whole life.
It’d suck to be at your wedding and be worrying about how you’re going to pay off the little details you’ve dreamed about. Save your money today to have that buffer so that you can use it when the time is right. I’d hate for you to miss out on that once in a lifetime thing.
What has your buffer allowed you to do that you would have otherwise missed out on? Was it worth savings a little now to be able to afford it?
Joshua Rodriguez says
Great article. I agree that having a buffer relieves a huge amount of stress! In the past my buffer has allowed me to make last minute trips across the country to see family and friends.
Lance Mlandm says
Hopefully you had a good reason for the last minute trip or got a great deal!
Justin @ The Family Finances says
I have a good example of this from over the weekend, though on a very small scale. We’ve been thinking about getting this Little Tykes basketball hoop for our little boy. It’s a real quality-made toy with that durable plastic that will last forever. Anyway, it’s normally around $50 at the store, and I’ve yet to find a used one on Craigslist or at area garage sales. So, this weekend it so happened that the store had them on clearance for $30. Now, we had used all of our weekly cash already on groceries, expenses, etc. But we do build in a cash buffer to take advantage of unexpected opportunities such as this. Small scale, but it still counts.
Lance Mlandm says
If you were going to buy it anyway, doesn’t hurt to get a better deal. Hopefully you replenish your buffer next time you come across some money!
krantcents says
When I teach budgeting, I use a trip to Europe as a model. It includes a contingency for those things that may be unplanned. It is really a metaphor for life. I always include a miscellaneous in my budgets.
Lance Mlandm says
Contingencies are great and are even nicer if you don’t end up using them.
Budget and the Beach says
For me I think it’s probably been events that come up in the month that I get invited too but didn’t necessarily budget for. I think everyone needs that room in their account. Life shouldn’t be lived with such tight restrictions.
Lance Mlandm says
Tight restrictions are no fun, but sometimes they are necessary. After you get in better shape sometimes you can loosen up a bit at times.
Money Beagle says
Back when I was single and lived on the cheap, I always had a built in buffer as I lived pretty frugally. Now that I’m married with kids and in a bigger house and with more expenses, I have to work to create this buffer, but I do because of the exact reasons you point out.
Lance Mlandm says
Even though you have to work for it, at least you have it!
Thomas | Your Daily Finance says
Actually having a big buffer helped us get our home. For some reason a lot of people here in Florida are not willing to pay closing costs as a seller and are willing to have deal fall through. Maybe they dont have the funds either. Either way when we found the home we really want the seller didn’t want to pay and if it wasn’t for our savings buffer we would not have had the money to get the home. Closing costs are a lot of money. Now we are working on building that buffer up. Who knows, the next time that buffer could be what helps to get a real estate property or a business opportunity.
Lance Mlandm says
Buffers do give you that opportunity! I’m all for taking advantage when I see a good one.