Emergency Funds- The moment we hear this, it reminds us of our Savings A/c; isn’t it??? Most of us often confuse our Savings A/c with an emergency fund and hence believe that our savings a/c is our emergency fund.
If I go by the literal meaning of Emergency Fund – “It is that cash that one saves for the sole purpose of helping him/her maintain a normal life in times of unforeseen emergencies”. Now tell me – “Is it justified to call Savings A/c an emergency fund?” We use savings account for both our needs and wants whether it be our daily living expenses or shopping or entertainment expenses. And as the month end approaches, in most cases the balance in savings a/c tends to get to its lowest levels. Continue reading