What Is An Emergency Fund?

Are emergency funds, rainy-day funds, and reserve funds all considered the same thing? Are your life savings the same as an emergency fund? Yikes, I hope not! By definition – an emergency fund is savings set aside to cover one specific purpose – an emergency. An emergency can consist of a broken water heater, medical expenses, a flat tire, lost job, or any other financial surprise life throws your way. Any unexpected expense that can cause undue financial hardship on someone is an emergency and should be covered by money in your emergency fund…

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