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Maybe your car broke down, your computer was stolen, or you had a surprise visit to urgent care. Emergencies are inevitable, but you can prepare to deal with them by building an emergency fund. There are so many things that happen in our lives that we dont expect and most of them require financial means to overcome, said Miklos Ringbauer, a certified public accountant. The industry standard is to save three to six months of expenses in an emergency fund. However, this can feel daunting if you live paycheck to paycheck or if you have debt. But if youre in either of these situations, its even more crucial to build a financial safety net that can help you in times of crisis. Emergency funds allow you to prevent further debt, said Jaime Eckels, certified financial planner and wealth management leader for Plante Moran Financial Advisors. Suppose youre paying multiple credit cards and other loans. In that case, Rachel Lawrence, head of advice and planning for Monarch Money, a financial planning and budgeting app, recommends that you make the minimum payments while you build your emergency fund. Once youve hit an amount that feels right for your lifestyle, you can go back and continue tackling your debt more aggressively. Whether you want to start an emergency fund or create better habits while you save, here are some expert recommendations: Start with small milestones The idea of saving for three to six months worth of expenses can be daunting, so its best to start with a smaller milestone. Lawrence recommends starting with a goal of saving $1,000, then moving on to save one, three, and six months of expenses. The way you approach this goal can vary depending on your income and your budget. But starting with small, attainable goals can help you build an emergency fund without feeling financially strained. Starting small is okay. Even if its $20 right out of your paycheck, those small things can add up, Eckels said. She recommends building your emergency fund in a separate account from your regular savings account, ideally a high-yield savings account, which offers a higher interest rate than a traditional savings account. Decide on the appropriate amount for your life Knowing how much to save for your emergency fund depends on your life situation. Lawrence suggests you gauge your own financial responsibilities to estimate how much your ideal emergency fund should be. For single professionals with no significant financial responsibilities, such as a mortgage or a car, the amount might be $2,000 to $3,000. At the same time, people with children and several pets might aim to save for six months expenses. There’s no one-shoe-fits-all solution. Everybody is different, especially if you have variable expenses on a monthly basis, Ringbauer said. Lawrence recommends that self-employed people maintain two emergency funds: one to buffer low-income months and another for true emergencies. To build your buffer account, Lawrence recommends setting aside some money during high-earning months. You set that amount aside in your buffer account until you have two or three months of the amount that you want, she said. Because that way any month where you have less money, you go pull from the buffer and its no big deal. Automate your savings Eckels recommends setting up automatic savings as a low-effort way to build your emergency fund. Scheduling your savings to be withdrawn from your bank account as soon as your paycheck arrives is an effective way to build a savings habit without having to transfer the money manually. I always tell people if it was never in your bank account, you never had it, right? Eckels added. She also recommends that her clients open a separate account, one that isnt at the same bank as their checking account, so they arent tempted to transfer the money in a non-emergency. Make it visual As youre making progress towards your emergency fund goal, making it visual can help you stay motivated, according to Lawrence. She recommends getting creative with how you track your progress, ideally with a method that brings you joy. You want your brain to get rewarded as often as possible when youre seeing a bunch of progress, she said. Some options to make your progress visual include drawing a thermometer-like tracker and keeping it updated as you advance toward your goal, documenting your progress on a habit-building tracker on your phone, or using a budgeting app with a tracking tool. Save windfalls If your budget is really tight and you dont have much wiggle room to set aside money for an emergency fund, Lawrence recommends saving windfalls. Unexpected chunks of money that maybe you werent expecting, like tax refunds or getting a third paycheck when you normally get paid twice a month, or a bonus, those are your best ways to make progress when youre tight otherwise, said Lawrence. In general, Lawrence recommends that people keep 10% of their windfall for themselves and the rest for their emergency fund. With that breakdown, you can both save and feel rewarded by the unexpected income. If you use it, don’t feel guilty Chances are that an emergency will happen, and when it does, you dont need to feel guilty for using your emergency fund, Lawrence said. Instead, its best to think about how youve achieved your goal of building a financial safety net for yourself. You wouldnt feel bad about using your down payment to buy a house, you wouldnt feel bad about saving for retirement, actually to retire, Lawrence said. The Associated Press receives support from Charles Schwab Foundation for educational and explanatory reporting to improve financial literacy. The independent foundation is separate from Charles Schwab and Co. Inc. The AP is solely responsible for its journalism. Adriana Morga, Associated Press
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E-Commerce
For the 150th episode of my award-winning podcast series, FUTURE OF XYZ, I sat down with Nick Foster, former head of design at Google X and leading futures designer. We quickly found common ground in our strong belief that society doesnt think about the future in the right way. Too often, the future is reduced to flashy visions, both in media headlines and through messages from leading corporations. The future feels like a sci-fi movie that still seems far away. Nick and I both believe the future isnt some distant fantasy, but rather a tomorrow already unfolding before us. To prepare, we must pay closer attention to what we know now and how people are acting today. What drives Nick and his work isnt predictions or bets, but a deeper exploration of how we think about the future itself. That distinction resonated deeply with me. In my own workwhether the podcast, as a leader at iF Design, or in my consulting work, Ive argued that the future isnt something just out there to predict. Rather, the future is something we actively construct through our choices and the questions we dare to ask. IMAGINE THE FUTURE Nicks new book, Could Should Might Dont: How We Think About the Future, emerged from years of conversations inside Google X and beyond, where he noticed a surprising truth: Even among the worlds leading innovators, we often fail to approach the future with real rigor. We rely on hunches, dotted lines, and simplified stories. This lack of discipline not only weakens the conversation, but leaves us ill-equipped for whats actually to come. Rather than writing a manifesto or prescriptive framework, Nick created a taxonomya way to classify the different modes of imagining the future. By delving into how we think about the future, he hopes our collective conversations become more rounded, more actionable, and more honest about uncertainty. During our conversation, we touched on the future mundane, the idea that most lived experiences will be found not in extremes, but in the everyday middle of the bell curve. This lens particularly aligns with my own mission at iF Design. Design, after all, is the mediator between big ideas and daily life. From the products we use, to the systems that govern them, to the values they embed, design shapes how we experience change. My role at iF Design is precisely about interrogating this: How do we embed sustainability and impact into design decisions so that what feels ordinary tomorrow reflects responsibility and resilience, not just convenience or speed? Nick also reflects on a profound cultural shift we are experiencing. For the first time in modern history, entire generations are less confident about what the future will bring. Having pushed exponential economic growth to its limits, were beginning to wrestle with the well, and now what? question that undercuts strident narratives of progress. In my own conversations, Ive seen how this moment of reckoning demands we focus on intentionality, pivoting from chasing growth alone to cultivating resilience. WHATS NEXT In Nicks view, technology currently holds the wheel when it comes to shaping whats next. With that power comes responsibilitya responsibility corporations and societies alike have yet to fully embrace. I often remind audiences that while technology will remain a critical driver, its our values, our courage, and our willingness to collaborate that will ultimately determine the future(s) we design into being. And as Nick reminded me, in a time of unprecedented change, we must resist the urge to cling blindly to what we already believe. Instead, we need to ask deeper questions, demand more rigorous thinking, and recognize that imagining the future is not just for futurists. Its a collective skill we all must learnand practice together. Thats precisely why this conversation mattered to me. Every day I explore how leadership, design, and purpose intersect to shape a more human, more sustainable future. Nicks work underscores that same truth: The future isnt something happening to us. Its something we are all responsible for shaping. And that begins with how we choose to think, design, and act today. Lisa Gralnek is global head of sustainability and impact for iF Design, managing director of iF Design USA Inc., and creator/host of the podcast, FUTURE OF XYZ.
Category:
E-Commerce
Picture the scene. Youve advertised a job on LinkedIn and received applications from around Europe. The perfect candidate lives in one of the worlds top tech citiesParis, Berlin, or Amsterdam, for instance. Your company is based somewhere in Europe, so hiring them should be easy, right? Unfortunately, no. Despite their geographical proximity, countries in Europe still vary significantly in their hiring rules and regulations, making it hard to compliantly pay cross-border workers. Lets take a closer look at the problem. So close, yet so far Theres naturally a certain amount of friction in terms of labor law compatibility between European states inside and outside of the European Union (EU). But even within the umbrella of the EU, countries have their own labor, tax, and social security rules that can turn simple payroll procedures into a nightmare. Thats because EU labor law is issued via directives that allow member states discretion in how they implement rulings. For businesses, this makes an EU-wide hiring strategy impossible, instead requiring individual approaches to each and every country a company might want to hire inup to and including incorporation. This isnt something that can be done as an afterthought. Misclassifying a worker, for instance by employing someone as a contractor rather than an employee, may lead to penalties and legal trouble. The state of cross-border hiring in Europe Despite the difficulties, businesses continue to hire across borders for the simple reason that talent is getting harder to find locally. One report found that 54% of European employers expect labour shortages to worsen over the next five years. And a patchwork of talent availability means skills and the businesses that need them are rarely in the same placeforcing businesses to look elsewhere. But hiring across borders isnt getting easier. While the demand for specialized talent has increased by 112% over the last three years, the complexity of hiring talent has also increasedparticularly in the EU, with incoming requirements like the pay transparency directive. The movement of workers between countries is also a minefield. Under EU rules, employees can only be subject to one countrys social security requirements at a time (to avoid double contributions). Some countries have cross-border agreements but employee tax exposure can be hard to fully comprehend, even for the experts. Heres what that looks like in practice A London startup wants to hire its first engineer in Berlin. Expanding into a new European talent market means a costly and months-long process of establishing a business entityall to justify a headcount of one. How about a Dutch company trying to support an employee relocating to Spain? The employer wants to be supportive, but there are clear tax residency and other legal implications such as pay transparency that have to be explored. The difficulty of navigating these all-too-common issues is putting a roadblock on progress and forcing businesses to compromise on quality by hiring in their own backyards. The problem with payroll Despite most companies having employees in more than one country, the means of paying them continue to lag behind. Payroll (often the largest expense for a company at around 50-60% of spending) has historically been seen as a back-office burden. Payroll is an essential cost of business, but because of all the challenges weve discussed, its expensive, complex, and generally fails to add strategic value. When youre running payroll across borders, the complexity only goes up. Indeed, 85% of global executives say compliance requirements have become more complex in the last three years. In short, its all risk and no reward. The right software can help In response to the expanding global workforce, more workforce management companies are developing software designed to help companies hire and pay European workers without the burden of navigating complex administrative requirements. My company, Multiplier, offers one of these solutions. As a centralized platform for payroll operations, our payroll solution enables companies to pay employees in countries where they dont have a legal entity, fully compliant with local tax and social security rules. This would allow the London startup discussed earlier to hire its first engineer in Berlin without the delay and expense of incorporation in Germany. And if things dont work out, the startup wont have to go through the rigmarole of shutting down an entity in Berlin afterwards. Similarly, the Dutch company with a marketer who relocated to Spain doesnt have to worry about the tax residency implications and potential penalties. They can seamlessly support their employees without disrupting their existing payroll compliance efforts. Unlocking European talent Paying people across borders is a problem unlikely to be solved politically. In an increasingly multipoar world, theres little prospect of the increased regulatory alignment necessary to enable seamless international payments. In the meantime, payroll solutions will help remove the friction required to pay cross-border workers, helping companies to accelerate their growth and recruit the best European talentinstead of settling for the best available talent locally. Sagar Khatri is CEO and cofounder of Multiplier.
Category:
E-Commerce
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