One of your first saving goals should be to establish an Emergency Fund. As you can probably guess by the title, an emergency fund is where you store money for times of financial distress. By establishing an emergency fund, you will be creating a safety net, so that when something goes wrong, like a pandemic or a car breaking down, you will have money stashed away to cover expenses until you are back on your feet.
- Many experts suggest that your emergency fund should cover 3-6 months of your typical expenses.
- Finally, your emergency funds should be kept in an account that is very "liquid" or in other words, an account which allows you quickly withdraw money when you need it.
- Potential good options for storing your Emergency Fund could be a savings account or money market deposit account.