Business View Magazine | November 2020

5 BUSINESS VIEW MAGAZINE NOVEMBER 2020 O p e n i n g L i n e s N O V E M B E R 2 0 2 0 4 UNIQUE STRATEGIES FOR PEOPLE STRUGGLING TO BUILD AN EMERGENCY FUND W hether it’s a global pandemic or everyday car trouble, financial bumps in the road always come at unexpected times. Without an emergency fund, life’s surprises can turn into a cycle of debt and interest fees. But, as with starting a fitness plan or eating healthy, getting started building an emergency fund is always the hardest part. What is an emergency fund? An emergency fund is an amount of money set aside for no other purpose than financial assistance in an unexpected emergency. Medical bills, flat tires, home repairs, or unanticipated job loss are all examples of unwelcome situations that could be covered or made easier by having an emergency fund in place. How big should it be? When starting an emergency fund, having some money set aside is better than none. Even $50- 100 can help to ease the anxiety associated with an unanticipated expense. That being said, the general recommendation for the amount of an emergency fund is three to six months of living expenses. That means if monthly costs are $2,000, the emergency fund should be anywhere from $6,000-$12,000. The amount can vary depending on job stability and how long it would take to recoup income if it were lost. Ways to save more It can be challenging to reconcile saving money that doesn’t serve an immediate purpose. But the