It’s best to have a separate fund to cater emergencies. But what should it look like? How big should it be? Should you open a separate bank account or keep some cash reserves? The answer is Have a Liquid Fund. Liquid Fund is a new age financial tool and by far one of the best tools to build an emergency fund. Just like your savings account, liquid fund offers you the ease to deposit or withdraw money any time and offers more return than your Savings Account.
Once you have it, make sure it is equivalent to 3-6 months of your monthly expenses. Thinking how would you save it? Set up automatic monthly transfers from your account to liquid fund till you reach the desired goal. Remember, in emergencies we don’t fund vacations, new clothes or gadgets when your bank account does not let you do so.
Save whatever you can, even if it isn’t much
Someday you’ll be glad you did!!