To Prepare for Unexpected Expenses  

At any time, you could be forced to pay an array of unexpected expenses. From home repairs and car repairs to emergency pet care, there’s a whole list of expenses that could pop up.

This is what an emergency fund is for. Having extra funds set aside will come in handy when these unforeseen events do arise.

To Save You from Debt

It feels impossible to get out of debt when new expenses unexpectedly pop up.

But if you have an emergency fund ready to pay off those urgent expenses, you will have more money left to pay off your debt. You won’t be forced to borrow money as often or take money out of your savings account.

Peace of Mind

We all stress about our finances on a daily basis.

The anxiety of not having enough money can definitely take a toll on your emotional well-being.

While an emergency fund won’t cure all your money problems, it can definitely take some of the anxiety away. Just knowing that you’ve got the money to cover unanticipated costs will take a huge weight off your shoulders. You’ll have peace of mind knowing that if things go wrong, you have a plan.

Emergency Health Situations  

An unforeseen medical emergency could take a huge hit to your bank balance.

Your health insurance may not cover certain types of medical issues. An emergency fund will help you cover these costs and put your mind at ease during this stressful period.

If you Lose Your Job

In the event that you lose your only source of income, an emergency fund will be a lifesaver.

The unemployment period will be much more stressful if you haven’t got enough money to last. You never know how long it will take to get your next job, so you should always be prepared for the worst.

To Meet Your Financial Goals

Do you have a financial goal that you’re working towards?

Perhaps you’re trying to save enough money to buy a new laptop, a new car or even your first home.

Having an emergency fund ready will help you stay on track to meet your goals. When emergency financial situations arise, you won’t be forced to dip into your savings account.

You can continue saving for your dream home and use your emergency fund when needed.  

To Help with Tax Issues

Sometimes your tax bill is not what you expected, which can be incredibly stressful.

If you realise that you owe more tax than you anticipated, you can use your emergency fund to save you from a financial crisis.

Last Minute Travel

Do you live far from family?

In the event of a medical emergency or an unexpected death in the family, you’ll need to have enough money to fly home. You don’t want to be in a situation where you can’t make it to a funeral due to lack of funds.

Booking flights at the last minute can be extra pricey, so it’s good to be prepared ahead of time.