About Half of Young Adults Can't Cover a $1,000 Unexpected Expense. 4 Tips to Prepare

Would you be able to cover a $1,000 unexpected expense? Nearly half of adults can't.

Unexpected life events can be stressful -- especially when they come at a high financial cost. By preparing and having an emergency fund, you can make a difficult time less upsetting.

A recent study found that almost half of young adults are unprepared to cover a $1,000 emergency expense. Would you be able to handle the cost of an unexpected expense? Find out how to prepare, so you're ready.

Fidelity Investments polled young adults ages 18 to 44 to learn how they feel about money. Many respondents feel stressed when thinking about money. While many are interested in saving money, they don't want to give up their current lifestyle.

Check out some of the findings from the survey:

• 49% of the young adults surveyed said they wouldn't be able to cover a $1,000 unexpected expense.
• 59% cringe at the thought of checking their bank account balances.
• 51% of respondents said they don't pay attention to how much they spend and save, as long as they have money in the bank.
• 71% of the young adults surveyed are motivated to save money but don't want to sacrifice their current lifestyles.

This study shows that young adults want to live an enjoyable life and they don't want to be stressed about money. But it may be difficult to reach essential savings goals if they're not prioritizing taking action.

Could you cover a $1,000 emergency expense?

Are you like the nearly half of young adults who would be unable to cover a $1,000 emergency expense? If so, now is an excellent time to build an emergency fund.

For those with limited income, it's okay to start small. Saving even just $10 each week would result in a yearly savings fund of over $500.

No set number works for everyone regarding how much to save. But it's good practice to consider potential larger unexpected expenses and what those situations might cost you.

For example, getting your car repaired, replacing an appliance, or paying an unexpected medical bill -- all require a good amount of money. Having the money you need in your savings account could make the situation much less stressful.

4 tips to prepare for unexpected expenses (before they happen)

1. Open a savings account and start your emergency fund

Do yourself a favor, open a savings account, and start your fund now. Even if you only have $50 available, it's a start. It's better to start today than wait until it's too late.

2. Automate your savings

Are you looking for a way to simplify saving? You can set up automatic transfers so that you're regularly putting money into your savings account. This will save you time, and you won't forget to save if you don't have to think about it.

3. Review your insurance policies

Some emergencies can be easier to deal with if you have proper insurance. For example, renters insurance and car insurance can be helpful to have.

It's a good idea to review your insurance policies and check coverage details annually, so you know what to expect if you ever need to make a claim. Make sure you have enough money set aside in savings to pay your deductible.

4. Have a backup plan

Life doesn't always go as planned, and even if you save up, you may not be prepared for the total cost of an unexpected expense. It's a good idea to have some backup plans in mind in case you don't have enough money saved. Here are some options to consider:

• Can you get a 0% APR credit card and use that to cover the expense?
• Are you able to get on a payment plan?
• Do you have time to get a side hustle or part-time gig?

You're not alone if your savings fund is small or nonexistent. But choosing to take small steps today can make a difference, and better prepare you for the future.

Check out these personal finance resources for additional tips on managing your money and saving more.