Kiplinger

Emergency Funds Can Have a Surprising Downside

Why save for opportunities when everyone tells you to only save for emergencies instead?

Because you'll be operating from a place of abundance, not scarcity, and that can make a world of difference.

It's valuable for each family to have a cash emergency fund that can be tapped for true emergencies -- like a car breaking down or furnace repair in winter -- but this needn't be more than a few thousand dollars. Typically, an emergency fund is a pot of money equal to three to 12 months of living expenses.

Once you've comfortably saved for an unforeseen, short-term emergency, then you can turn your attention to higher aspirations.

Let's Get Real

It was devastating to our family when

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