An emergency fund is exactly that – it’s the money that will tide you over when an emergency happens.
This includes losing your job, having to pay for urgent home or car repairs, and to pay for medical and dental emergencies.
Because it’s meant to be accessed quickly, you should keep your emergency funds in a liquid bank account.
First you should know how much you spend in a month.
Keep track of your expenses for three to four months.
You should already start saving some money while you do this exercise.
An emergency fund should only be used to cover the necessities and not the luxuries, which means bills such as transportation, utilities, groceries and your rent or mortgage.
You should not be using this money for holidays or shopping.
Save money in ways you’ve never thought of before with these 10 tips.