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What is an Emergency Fund For?

The Emergency Fund, a bunch of money stacked away to cushion … well…. emergencies, is a common theme on personal finance blogs.

But when is an emergency an emergency?

  • Sudden job loss
  • Death or medical emergency of a family member
  • Acts of nature
  • Car accidents.
  • Surprise tax bills.
  • Delay in income.
  • Sudden relocation

Some situations that don’t qualify as an emergency fit to dive into your emergency fund are:

  • Vacation
  • A buying “opportunity” in the stock market or real estate
  • Out-of-town visitors.
  • Mid-life crises
  • Keeping up with the Joneses

Your Emergency Fund: What Qualifies as an Emergency?

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