RateAPY

The Importance of a Six- to Nine-Month Emergency Fund

Posted by: RateAPY Bank Rates News
December 20th, 2009

If you have credit card debt or a mortgage balance, you may think that paying those debts down is priority number one. But, if the last two years has taught Americans anything at all, it is the importance of having an emergency fund that covers your expenses for six to nine months. You should keep debt and expenses as low as possible and put as much as possible into a savings or money market account.

If you are trying to pay down credit card debt or a mortgage, you may not be paying enough attention to your emergency fund. If you lose your job or have to take a cut in pay, you need to have money set aside for at least your housing and car expenses. Ultimately, you want to be able to cover your entire budget. But having money enough to pay for housing and a car to get to work should be first and foremost of what to do with your money.