If you needed $2,000 for an emergency, would you be able to come up with it at a moment’s notice?
If you could, then good for you. Unfortunately, most American’s haven’t (or can’t) put away anywhere near $2,000 for retirement, paying off debt, or other necessities. If these people faced sudden charges due to hospital visits, car wrecks, or any unforeseen financial burden, they would simply go into more debt.
Fortunately, you can face these nasty surprises head-on by creating your own personal emergency fund. By scrounging together some cash and keeping it in a safe, accessible place when you need it most, you’ll avoid any costly expense that life throws at you.
If you still don’t understand the importance of creating an emergency fund, Forbes is here to give you the reasons why you should start saving now. If you don’t, you could end up paying dearly.
There are many ways to create an emergency fund. You could save money and tuck it away in your savings. You could allocate $2,000 towards a low-cost ETF and liquidate it when you need it most.
Regardless of how you decide to save $2,000, just make sure you are able to access it within a day or two, and could be converted to cash if need be. You might need to also contact your financial institution to warn them that you’ll be making a large withdrawal in case it exceeds their daily limits. Once you take these steps, you’ll be able to rest easy knowing that you’ve got your bases covered.