Emergency Funds – Funds that you can save for your ill time and never be touched except emergency.
Mutual Fund – Funds that you can use as a long term investment.
Having an emergency fund isn’t mean that you are rich or doing well for your living, it means a lot more than that. You can easily fulfill all your financial needs when you have a good job, Can you imagine if time changes or you don’t have any job and also suffer with financial crises. It’s always a good idea to plan you for future and start saving funds as an emergency fund that helps you to fulfill almost most of the requirements. An emergency fund makes you confident and wise vision for future aspects.
Saving funds for emergency is always a wise idea, rather than to borrow money from money lenders. Emergency funds helps you avoid that extra cost of interest rates that money lenders charge for the money lend you in your emergency times.
Questions is – why do we need an Emergency fund?
Well, everyone should know why it is important to all. You don’t even have an idea or may never know what happens to life. In that case, money lenders will lend you money but, they will also charge high interest rates to your mortgage in return. To avoid this high interest rate and ask money from money lenders, using your emergency funds are way better than anything else.
Here are the top priorities that can be considered as Emergency funds.
- Lost your job – It doesn’t matter how much you love your job but the question is – you never know when your company stop feeding you. You know how much cost when you lost your job or still have bills to pay and mortgages. Monthly regular income is most important to make your living smoothly. But this isn’t be smooth or cool if you lost your job and not able to find a new job for days or even month. What should you do? How can you make your living? How can you pay your bills, mortgage, Travel expenses, Home, food expenses? The only thing you can save yourself by using your emergency funds and can make your living better till you get the new job.
- Medical Emergency – health is wealth, that why everyone understand how important our health matters to us. In today’s modern life, maintaining yourself fit and fine is quite important to all of us. But, you don’t know how when you need a medical emergency. Medical emergencies are not only related to your health issues but also related to accidental cases. We need money instant to pay medical bills when there is any medical emergency and for the sake of life, we have to arrange funds from anywhere, Money lenders are the only option left to you if you don’t have any emergency funds in your account.
- Unplanned visits – Everyone know there monthly income and expense and definitely can maintain budgets according their income source. Most of us are only have the limited or fixed amount of earning and never expect to have an unwanted expense or visits. This may cause them a financial crises and due to a limited source of earning they won’t afford unwanted expense or visits.
Sean Colangelo helps you to know more about emergency funds.