Why Emergency Funds Should Be a High Priority

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So why should building an emergency fund become a top priority? In a way, it makes financial sense to pay off student loans as soon as you land a job.

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What is an emergency fund and why do I need it?

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How much should I put into my emergency fund?

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Where do I put my emergency fund?

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A high-yield savings account is a type of savings account that earns you a higher interest than traditional ones.

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The more often the interest is compounded, the higher your interest becomes on your emergency fund.

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Why Emergency Funds Should Be a High Priority

So why should building an emergency fund become a top priority? In a way, it makes financial sense to pay off student loans as soon as you land a job.

What is an emergency fund and why do I need it?

Think of it as a safeguard for when something unexpected happens, saving you from having to take out another loan or racking up on credit card bills.

How much should I put into my emergency fund?

The size of your emergency fund is a personal matter, but there are some general rules you can follow.

Where do I put my emergency fund?

Due to its nature, an emergency fund should be liquid, but that doesn’t mean you should be hiding money in a piggy bank. It’s best to separate it from your checking or main savings account.

A high-yield savings account is a type of savings account that earns you a higher interest than traditional ones.

The more often the interest is compounded, the higher your interest becomes on your emergency fund.

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What’s Next?

Once you’ve figured out the right balance between debt repayment and savings, the next step is to look at investment opportunities.

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