Emergency Funds Are Important + $100 Paypal/Amazon Giveaway!
In the harsh economic times we are now enduring Emergency Funds have never been more important! A decade ago when the economy was booming we might have considered an emergency fund just to cover the odd unexpected broken appliance, vehicle or perhaps to help out a family member in a time of need. When you consider the precarious nature of the current economy though, emergency funds take on a whole new light!
Prepare For The Worst
The UK economy seems to be taking one step forward and two steps back! The moment we have a bit of good economic news, it gets clouded out with news of a factory closure and thousands of job losses, or of a retail chain going into administration. Bearing this in mind it’s extremely important that you take your emergency fund more seriously than you ever have in the past.
How long could you survive financially if you were to lose your job? 6 months, 3 months, less??
Nobody is immune in this economy and it’s not overly pessimistic to prepare for the worst. This might mean making cutbacks in certain areas to put some money into an emergency fund, temporarily affecting your lifestyle. It might seem like hard work in the short term but you’ll be glad you did if something happens with your job!
The Bigger The Better!
A big question people often ask when it comes to emergency funds is ‘How Much Should I Put Into An Emergency Fund’?
There really is no set figure that can be recommended in answer to this question, it all depends on your circumstances. In times gone by when the economy was sound we might only have been thinking of preparing for small emergencies and a couple of thousand may have sufficed. Nowadays it’s wise to consider how long you could last were the worst to happen and you lost your employment. Government benefits for job seekers are often insufficient to cover the living costs of an average family so you need a healthy amount in reserve to cover your day to day expenses in the event of a job loss. I would say in this economy it would be wise to have enough money put away in an emergency fund to keep you going for at least 6 months if you were to lose your job.
Once It’s There You Can Start Spending Again
This is a point that often gets forgotten when thinking about starting an emergency fund. It might seem like you have to change your lifestyle forever to save an emergency fund. That just isn’t true though! Once you’ve lived frugally for a while and built up your emergency fund you can resume your old lifestyle safe in the knowledge that you are financially secure for a good period of time if the worst was to happen!
What Do You Think? Do You Need An Emergency Fund & How Much Is Enough?
Now For The Giveaway!
This Post was written for the Snowflake Giveaway Hosted By Savingadvice.com. Get Your Entries In Below By November 10th For A Chance To Win $100 In Paypal Cash Or A $100 Amazon Voucher (Your Choice!) If You Live In The UK You Can Still Enter And You Will Receive The Equivalent Amount Of Paypal Cash After Exchange Rates Have Been Taken Into Account!