When And What To Save In Case Of An Emergency
If you have ever been in a traffic accident, you know the awful feeling that comes with an unexpected financial burden. Knowing you have funds set aside to help in an emergency will give you peace of mind and will help you avoid the moment of panic that comes when faced with a sudden shortage of cash. How much should you have in savings dedicated towards an emergency fund? Here is our Emergency Fund 101 to guide you.
- Who Needs An Emergency Fund? Long story short, everyone does. The only certainty in life is uncertainty, but you can protect yourself from financial trouble by setting aside a cushion.
- How Much Should I Save? Experts say you should generally put away between three and six months’ living expenses. While it may be tempting to minimize the amount in your emergency fund when you are strapped for cash, the reality is the more financially unstable you are the larger you will likely need in your emergency fund since you will be unable to pull money from other places such as investments.
- When Should I Use It? Only when you absolutely must. If, for example, your car breaks down but you can take public transit while you save to repair it, protect your emergency fund by abstaining from using it. It would be terrible to deplete it just before you really need it.
Another way to protect yourself against unforeseen financial burden is by securing comprehensive insurance coverage. To learn about what kind of insurance you need, contact Young Insurance Agency for a free quote today! Located in Burbank, we offer auto insurance, homeowners insurance, health insurance, life insurance, and commercial auto insurance. We can be your one-stop shop for all of your California insurance needs, so call us today!