You’re currently building an emergency fund, and you’re dutifully squirrelling away a good portion of your paycheck month by month to make sure you’ve got some money for the future; but what are you really saving for? And how will you know the time has come to use your emergency fund? Well, if you’re a bit clueless in this department at the moment, here are a few different scenarios that an emergency fund can be a big boon for.
If you’re worried, just crack open the piggy bank! They’re cheap enough to replace anyhow!
When a Medical Emergency Has Come Up
Medical emergencies are very troubling, and they can happen at any time. An emergency fund is usually started with the sole aim of dealing with an accident or emergency regarding your family’s collective physical and mental health.
Because of this, if someone who is dependent on you has suffered an injury or major illness, or you yourself are out of work for the time being because of an accident that wasn’t your fault, make sure you put those savings to good use! And don’t be afraid to spend the majority of them if it means you’ll be back on your feet much faster than you would without a bit of spare cash.
When There’s Trouble in a Relationship
Relationships are a lot of work, and when one is breaking down, or someone you know and love is suffering from a failed relationship at the moment, you’ve got every right to open up your emergency fund.
It could be your best friend needing a sofa to sleep on for a little while, or it could be losing half of your household income stream; an emergency fund can cover the costs of either one, for the time being, giving you the much needed time to sort things out.
Not to mention, if you need to visit a family solicitors service in the near future, your emergency savings fund might just be the only thing that can cover the cost.
When There’s a Gap in Your Income
If you’ve recently lost your job, or you’ve been made aware of the potential redundancy of your current position, you’re going to need to rely on your emergency savings for the time being. After all, if you’ve got no renewable source of income, and you’re not sure when you will again, you’ll be needing that backlog to see you and your family through.
Emergency funds generally have about 6 months worth of expenses covered, which gives you a good half a year to get back into the job market and pick something up. Even just a job that pays a decent wage that you’re not specifically trained for is going to work a treat until you feel stable enough to move on up!
The emergency fund you’re keeping safe can be used at various points in your life. Don’t be afraid to take money out of it if you’re in need.