Why You Should Have An Emergency Savings Fund

If you are like most people you never know where you spend your money, this is a serious mistake, as it can greatly affect your family economy. Money emergencies are a terrible experience for all families and nobody wants to be in an emergency situation, the problem that these cases can happen at any time. So for your peace of mind the most advisable thing is to create a fund for emergencies. Say for example your garage door breaks, but you have no money for garage door repair. That’s when your emergency fund will come into play.

This way at the time of any emergency, we run no risk of acquiring debts, because we are prepared for the unexpected, it will not be necessary to withdraw everything from the credit card, this is the idea of the good habit of saving for emergencies. The faster you start creating your fund for any unforeseen, you will have greater peace of mind. Take note of the following tips.

Amount for emergency: Start by evaluating what your financial situation is and think how much you could use urgently, for better control you have to start from the number of people who are totally dependent on you, you should ask yourself the following question: how much do I need for each? When you already have the account of the main expenses of each person, try to keep the money to meet all the main needs of your entire family group, it is recommended that the expenses be from three to six months at least.

Keep it at hand: That’s why it’s called an emergency fund, you do not know when it can be used. If you decide to open a savings account, you can do so, but you should always have immediate disposition. Never put a term because you cannot count on your money until the deadline agreed with the bank is met, otherwise you must pay a quantity of money if you want to withdraw it. So it does not suit you, the important thing is to always have it at hand. You don’t want to wait weeks before you money clears for something like garage door repair, you want it immediately.

garage door repair

Life insurance: You must be sure that the bank will give you the money when you need it. So you do not want to take any kind of life insurance, at least not with the emergency fund because the bank will make withdrawals to pay for it.

If you do not have your emergency fund yet, follow these tips and start establishing a savings amount as soon as possible.