Emergency can come at any time in future. We should always have some savings for emergency. So that we do not face any problem of money. This emergency can be marriage, serious illness and higher education of child etc. Let us know how to prepare fund for emergency and how much amount is required.
No emergency comes with any notice. We may have to face any kind of emergency in the future. In such a situation, we will have to be fully prepared for an emergency situation.
We will have to prepare a large fund so that there is no shortage of money in an emergency.
How to prepare an emergency fund?
Saving is very important for creating an emergency fund. If you want to prepare an emergency fund, then definitely adopt the methods mentioned below.
- First of all, you have to prepare a budget of your monthly income and expenses.
- Through this, it can be ascertained how much money you will be able to save.
- From this savings, you will also have to keep a fund for emergency.
- You can also invest this money somewhere. However, keep in mind that
- the investment platform should be such from where you can withdraw money without any hassle.
How much amount is necessary?
The amount fixed for emergency depends on your salary. Along with this, it also depends on how much money is saved from the salary. It is said that a person should keep an emergency fund equal to 3 to 6 months of expenses.
For example, if you spend Rs 30,000 every month, then you should keep at least Rs 90,000 for emergency. Similarly, if the salary is Rs 50,000 and Rs 20,000 is spent. So keep at least Rs 60,000 for emergency.
In simple words, you have to multiply the expenses of one month by 3 or 6.
Emergency fund = Expenses made in one month x 3 or Expenses of one month x 6
Why is emergency fund necessary?
We may have to face any kind of emergency in future. It is important to always be prepared for such times. Emergency fund enables us to deal with any financial problem that may arise in future.
You can prepare an emergency fund even with a small amount. This fund depends on your salary. But always keep some part of your salary for times of emergency.
