When you were younger, you probably dreamed of being a financially independent adult who constantly treated yourself to new toys. If only that were the reality. Unfortunately, the responsibility of being an adult often means putting that expensive gadget back on the shelf and saving for the unexpected. But why should you have an emergency fund, and what might you need to save for?
It’s a scary thought – and certainly not something to dwell on – but you or a loved one could get into an accident at any time. If the injury occurs in the workplace or isn’t your fault, you might be entitled to compensation, and may go through a law firm such as Chaliklaw, for example. However, you might need your emergency fund to cover any medical bills in the meantime and to fund the time off work before you get what you’re entitled to.
2. Car expenses
Cars can be one of the greatest expenses around, and always seem to breakdown when you least expect it. Whilst getting your car serviced regularly can help to prevent this, you never know what might happen. You could need to pay for repairs, or buy a new car altogether, and an emergency fund will cover this.
3. Vet Bills
Whilst we love our fluffy companions, they can certainly be expensive. You can easily be floored by a pet’s unexpected illness, and be faced with a whopping vet bill or some very tough decisions. Having pet insurance, looking after them properly and ensuring you have that emergency fund ensures your furry friends are taken care of.
4. Made Redundant
Like accidents, you could be made redundant at any time. It’s not a cheery thought, but preparing for the possibility of this with an emergency fund will make life much easier during the time of unemployment, and will be one less thing to worry about during your redundancy.
5. Home Repairs
We all want to live somewhere we feel warm and safe, and this means preparing for any unexpected home repairs. Boilers can be notoriously temperamental, and if yours goes bust you could be faced with the prospect of no hot water or heating. Boilers are very expensive to replace but luckily there’s the option to buy boilers on finance if you don’t have the money set aside for this expense. This helps you ease the financial burden of having your boiler replaced. Likewise, you never know what the weather might throw at you; tough winds could mean collapsed fences, whilst torrential rain could wreak havoc on your guttering.
6. Technical Mishaps
In our modern world, we rely on technology for just about everything, and a broken phone or laptop could be disastrous. Whilst you might be careful with your gadgets, one of your kids could easily break them or they could get stolen. An emergency fund will be able to replace or repair your gadget and keep you connected to the online world.
It’s not all doom and gloom! You might get to a point where you urgently need a vacation, or perhaps a close friend is getting married on a beach somewhere far, far away. Whatever the situation, an emergency fund can also be used to treat yourself to a well-earned break from all the other problems life could throw at you.