We are advised to keep some money for emergencies. The recommendation is that we should have 3-6 months’ living expenses kept away. Of course, that’s after we are able to take care of today’s needs.
What emergencies? Medical emergencies, job losses, national economic downturns, etc.
Emergency funds are different from savings and should not be put together with regular savings. They provide a safety net in the event of a need, but they also allow you to sleep well at night, knowing that you are never bare, so to speak.
The fund should be kept in an account that is accessible but not in your face. It could be a simple savings account that is not your normal account, it could be an online savings account from which you can move the money to your normal account, etc.
When you think of the emergency fund, think of a safety net to catch you if you fall.
By the way, have you got your copy of my book In The Long Run? It will help you prepare for an inevitable future. Order your copy on Konga or Amazon.
Image by Stefan Schweihofer from Pixabay