Life can throw curveballs like medical emergencies, job loss, or sudden car repairs. Having an emergency fund gives you peace of mind and keeps your long-term financial plans on track.
How Much to Save
• Recommended: Save 6 to 12 months of your living expenses. For instance, if you spend ?50,000 a month, aim for ?3–6 lakh. • In India: Consider extra buffers for health emergencies (around ?2 lakh for hospitalization) or festival expenses.
Where to Park It
• Liquid Funds: These offer 6–7% returns with quick access, such as SBI Liquid Fund. • High-Yield Savings: Banks like Kotak or IDFC First provide 3.5–4% interest, giving decent returns while keeping funds handy.
Chart: How Long Your Emergency Fund Lasts
Here’s a visual breakdown of how your emergency fund stacks up against monthly expenses. If your monthly spending is ?50,000, saving ?1.5 lakh can last 3 months, ?3 lakh lasts 6 months, and ?6 lakh covers a full year.
Take Action Today
Start building your safety cushion today. Reach out to Investsphere Wealth at +91- 8975446462 to explore flexible and efficient liquid fund options tailored for your needs.
Disclaimer: This post is for informational purposes only and not financial advice. Consult with your financial advisor before investing.
Conclusion
An emergency fund acts as your financial safety net, helping you stay afloat during unexpected life events like job loss, medical emergencies, or urgent repairs. By setting aside 6 to 12 months of living expenses in accessible options like liquid funds or high-yield savings accounts, you ensure that sudden expenses don’t derail your long-term goals. It’s not just about saving—it’s about being prepared and protecting your peace of mind.