There are so many different reasons why saving up money for a rainy day is always a good idea. This money can help keep you afloat and allow you to pay your bills and expenses should an emergency situation ever come up. If you’ve put off saving, consider some of the following top reasons why you should always have an emergency fund. These are just some examples of what can happen, and even if you can contribute just a small amount every month, it can go a long way after a while:
Losing a job
If you’re ever terminated, laid off, or forced to quit (or if a contributing member of your household loses their job), then you can end up in a very tough spot financially. Relying on that steady paycheck for your monthly bills and expenses can be very stressful if you’re suddenly not receiving it anymore. Even with severance pay and/or unemployment compensation (which you could potentially be ineligible for, depending on your situation), it can still be difficult to keep up with bills. Even if you do qualify for these benefits, it could take a while for them to kick in. Your emergency fund can be what keeps you in your home and food on the table if you lose your job.
Serious home repairs
If you own a home, you have to be prepared for just about anything, and this can include much-needed repairs that aren’t covered by your home insurance and cost a fortune. For example, if you suddenly need a new roof, you don’t want to be stuck in a bind or forced to take out a loan. Instead, have the money ready by contributing to an emergency fund.
Many people rely on their car for day-to-day transportation, and this includes getting to and from work. If your car breaks down and needs to be fixed, it can be very expensive. If you don’t have the money saved up to fix it, you might be forced to opt for public transportation, which may not be very convenient (or possible) depending on how close to home your job is. Ensure you’ll always have reliable transportation to get to work by contributing to an emergency fund.
With or without health insurance, medical expenses can be very costly. An illness or accident can happen at any time, and you’ll want to be prepared financially if you need the money to take care of these unexpected expenses. Depending on the extent of your medical condition, this could also mean being out of work for quite some time, too. The last thing you’ll need is to worry about finances, and an emergency fund can make things much easier during this difficult time.
Are you receiving long-term annuity payments, but need to receive your money sooner in order to catch up on bills and expenses? Peachtree Financial Solutions may be able to help. Contact Peachtree Financial Solutions today to learn more about selling future payments for a lump sum of money.
Nothing above is meant to provide financial, tax, or legal advice. You should meet with appropriate professionals for such services.