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Why is Having an Emergency Fund a Necessity?

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Why is Having an Emergency Fund a Necessity?

Posted On: October 22, 2020 by Exchange Bank of Northeast Missouri in: Budgeting, Personal Finances, Save Money, Savings, Spending

With the recent events taking place causing widely experienced job loss, it’s been a clear reminder of how important an emergency fund is. When unexpected circumstances take place, having a fund to use for the time being will be what keeps the rest of your financial life going in a positive direction.  What’s an emergency fund?  An emergency fund is money you’ve set aside for unexpected expenses. This stash of money allows you to be prepared for the circumstances life throws at you rather than hoping nothing happens. The average recommended amount to save is 3-6 months' worth of your normal living expenses, but the more, the better.  In what circumstances would I need one?  You might be wondering in what kind of situations an emergency fund would come in handy. While the possibilities are endless and always unforeseen, here are some examples:  Job