No matter what age you are, I believe every person should have some kind of emergency fund. When I have children, I plan on having some kind of emergency fund for them as well as well as my savings.[no_toc]
I believe a college student should have at least $1,500 in their emergency fund, and more depending on your circumstances.
This can also vary depending on a person's situation, but I believe that number allows enough room in case if anything were to happen, there would still be money left over.
Having an emergency fund is extremely important for numerous reasons.
1. It can be helpful if you have a car.
Your car can break down and the parts and labor could potentially cost up to a thousand+ dollars depending on your car.
I used to have a car that broke down all the time and I luckily had an emergency fund. This was the car I had while I was in high school too. (Yes I even had emergency money in high school.)
2. You could be sent a bill that is much larger than you thought it would be.
I remember being in high school and being sent a phone bill that was much larger than I possibly even imagined it being.
I used way too many minutes and I apparently didn't even have a texting plan. I learned this the hard way but always made sure to realize what kind of phone plan I had.
3. Depending on how good your health insurance is, something bad could happen to you where you need medical care.
You could potentially be sent a large medical bill that needs to be paid off soon. Having an emergency fund ready allows you the capability to pay off the bill in time without accumulating any unnecessary charges.
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4. You could lose your job.
This has to be the most important reason to have an emergency fund. It's no news that we are in an economic crisis that is slowly getting better, but not anywhere close to where it should be.
People are constantly getting laid off or even fired for invalid reasons. It would be safe to have at least a few months worth of bills and expenses in an emergency fund in case this happened. If you have kids, this gives it even more of a reason to have an emergency fund in case this were to happen.
Obviously, it's extremely hard to save any kind of money whether you have kids or not, but if you can save up an emergency fund, it's a great idea.
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Do you have an emergency fund? How much do you think is a safe amount to have for a college student or regular adult?
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