Regardless of how financially stable you may or may not be, there are an incredible number of reasons as to why you should always build an emergency fund. Though the primary reason to build an emergency fund is to – you guessed it – fund emergencies, there are several other benefits of having a stash of money set aside. Here, we’re taking a closer look at why having an emergency fund is vital.
Job Loss
Despite your hard work, nothing is certain and you should never treat it as such. Even a long-term career isn’t necessarily set in stone. If you are made redundant or are forced to stop working for any reason, whether it is due to an underlying medical condition or a severe accident, your emergency fund can help cover the costs of your day-to-day living while you get back on your feet. While your emergency fund is unlikely to cover general costs for the rest of your life, it’s a good starting point and can help you get to where you need to be without being put under additional stress. If you are truly stuck for cash, bad credit payday loans may be able to fund a missed bill payment but for the longer term, an emergency fund will prove to be a better alternative
Medical & Dental Emergencies
Much like job loss, it’s almost impossible to predict whether something will affect your health and force you out of work for a number of weeks or even just cost a small fortune in bills or equipment. With an emergency fund, you don’t have to worry as much as you will already have put aside a substantial amount of money in order to cover these costs so you don’t have to make ends meets using your latest pay check. If you are already aware of a medical condition you have, it’s a good idea to start putting some money aside as soon as possible. We understand that it’s not nice to think or talk about, but an emergency fund can really help pull you through when you need it the most without having to rely on your friends or family.
Home Repairs
Sometimes those small home repairs that we continue to put off turn into a major problem and in some cases, can cost a small fortune to fix. When you build an emergency fund, however, you do not have to try and pull the funds together in order to get your boiler, tap or electrics fixed when you need them the most. This will help ensure that you are able to continue going about your everyday life without disruption or having to take time off work to get the job done. Result!
You Live Far Away From Family
Another great reason why you should always build an emergency fund is if you live far away from family. Much like we are unable to guarantee our own health, we are unable to guarantee the well-being of others. In some cases, you may be forced to fly home in order to spend time with a member of your family who has a serious medical condition. While you may be able to afford a visit every few months, if you plan to visit your family on a regular basis then you may need to save up. Having these funds can help you through challenging times, including those that are unexpected.
There are a number of reasons why you should build an emergency fund. Whether it is to visit a family member who suffers with a serious medical condition or you are undergoing redundancy, having some extra cash put away can help you get back on your feet. Start building your emergency fund, today!