If you don’t have an emergency fund then it may just be time to start having a think about whether or not that is a smart choice. Many of us think that there are better places to put our money than in this type of fund, but we have 7 reasons as to why this is something that everyone should have in their lives, a fall back fund which can support them in the event of a crisis.
Peace of Mind
There is a great deal to be said for the cost of peace of mind and above all else this is what you can expect when you have an emergency fund. Peace of mind means you sleep better at night and having cash to one side will give you exactly that.
Bad Things Happen
Whether we can see them coming or not, the fact of the matter is that bad things do happen and that is the time when you need that fund. From job losses to accidents, there is always the threat that something could happen.
Worst Possible Time
Not only do bad things happen, they very often happy at the worst possible time, a car breakdown after shelling out for a Whitsunday sailing adventure vacation for example. This is an age old problem and the solution for it is to make sure that you have money saved up in the event that a bad thing takes place.
Lower Stress Levels
They call stress the silent killer because it increases often without us noticing. To help lower stress levels it is important to have things organized and in order, and money is a big factor in staying stress free. Save up, store the money and you will have far less cortisone pumping around your body.
Being in a position of financial comfort means that you can make more confident decisions when it comes to money. This could be saying yes instead of no to a particular investment for example, something which you can now do with confidence, safe in the knowledge that you have an emergency fund in place.
Two Pay Packets
Whilst it sounds extreme, it is said that most of us are just 2 pay packets away from being homeless. If you lost your job and had no savings, things will spiral out of control pretty darn quickly and that is going to mean that you need an emergency fund to keep your head above water.
Position of Power
Having financial security puts you in a powerful position and it means that you can scrutinize more and take decisions in your own interest. For example there will be no need to take on jobs or tasks which you don’t want to, just for the money, as you will be in a more powerful position financially speaking.
It just makes good sense to have an emergency fund, start saving 10% of your earnings today and just watch it grow, it will come in handy when the chips are down.