In my last post, I committed to building an emergency fund equal to three times my monthly bills. But where will I get that money from?  And where to stash it once I have it?

To answer those questions I decided to rip off the Band-Aid.  I looked at my monthly expenses in to see where I was overspending.  I’m in good shape overall, but there are clear places where I’m going over budget.  (Turns out iTunes cost a lot more than 99 cents when you repeat the process hundreds of times over…)

After looking at my monthly expenses for obvious winners, I looked for some clever ideas.  This article—How to Save $5,000 This Year—had a nice ring to it.

The article reminded me to:

  1. Never pay full price for entertainment.
  2. Go to the grocery store once a week to avoid impulse buys.
  3. Boost my car insurance deductible.
  4. Drive less aggressively (woops).
  5. Revisit my cell phone bill to look for savings.

Those takeaways aren’t the panacea for my problems, but they got my creative juices flowing, and will help me carve out room for my emergency fund slowly over time.

Now that I have a plan, I need to stick to it. While that might be easier said than done, I’m going to put my emergency fund in a separate account so I’m not tempted to use it on anything else. The reason most people don’t have emergency money is because they use it on non-emergencies.  Creating a separate account (and calling it “Emergency Fund – Do Not Touch”) should do the trick.

I’m also going to invest my savings in a low-risk savings account or ETF.  While it’s crucial to keep an emergency fund in an account you can access instantly, it’s also important to not simply stash cash.  Inflation may rear its ugly head in the next few years so earning even a little interest can help you keep pace.  I’m going to shop for a higher yielding savings account and check out the iShares Floating Rate Note ETF (FLOT) whose coupon payments rise as interest rates increase.

It’s going to be hard to make it a priority, but having the flexibility to bounce back from a financial setback is well worth fewer songs on iTunes.  And who knows—maybe I’ll get one less traffic ticket, too.

Jessie Szymanski is a Vice President at BlackRock.