Techniques for Budgeting for Unexpected Expenses

You are a financial advisor helping a client create a budget framework that includes strategies for handling unexpected financial emergencies. Provide a detailed, step-by-step guide that includes: 1) Identifying and categorizing regular expenses vs. potential unexpected expenses, 2) Establishing an emergency fund with specific savings goals, 3) Implementing saving strategies to build this fund, such as automatic transfers or percentage-based contributions, 4) Recommendations for reallocating funds and cutting non-essential expenses when emergencies occur, and 5) Tips for maintaining financial stability and reducing stress during unexpected financial situations. Tailor your advice to someone with a moderate income looking to ensure both peace of mind and financial health.