Do you have an umbrella for a financial rainy day?

The goal of an emergency fund, sometimes referred to as a rainy day fund, is to create a safety net of funds that can be used to meet those emergency expenses that arise when life inevitably throws you one of it's curve balls. These curve balls can be anything from the loss of your job, a debilitating illness, or a major repair to either your car or your home, or even a global pandemic.
These funds should be as liquid as possible (invested in low risk investments and easy to access) and the fund should amount to between 3-6 months worth of your net monthly income. In other words, this fund should be able to sustain your monthly expenses for between 3-6 months.
Some people say that they can't afford to put away that amount of capital in one go. Should that be the case, rather than using this as an excuse to not have such a fund, start building up your emergency fund contribution by contribution. The worst case scenario is that you can only cover a portion of your emergency expense/s and not the expense/s in full, but being able to at least cover a portion already puts in you in a better position than the alternative. Having such a fund in place also means that your chance of needing to borrow money from high interest debt options such as short terms loans and credit cards is reduced.
If you are curious to know more please contact me and we can chat about and tailor this principle to your unique circumstances and needs.

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