Start with expenses. List everything. Use last month’s bank and credit card statements – including payment services like Venmo, PayPal, etc. Cross out everything that was not essential. Now re-write it, with only the essential expenses. Is there anything else that can be eliminated or reduced? If you are like 90% of our clients you can find more to cut this second time through. Then write it out again. This is your “survival” expense budget. Now identify your expected monthly income for next month — is it more than survival expenses? Good. You have a surplus that can be your safety net. Put that surplus into your emergency fund.
Or, when you subtract income from expense, do you get a negative number? That means you need to either cut expenses further, or increase your income. If there simply is no where to cut or add income, then you need to draw on savings if you have it to make up the gap. And that’s ok, that’s what it’s there for.