Emergencies happen all the time when we least expect them. Your car’s tire might explode or there’s a death. Whatever the case, it’s best to create an emergency plan that includes a savings account. Having money tucked away in case of an emergency calms your nerves. It gives you a sense of security during a chaotic time. Here are some reasons or events that make an emergency savings account a must.

Unexpected Bill

While you’re saving up for the best stethoscope for medical school or a new car, unexpected bills crash your plans. It’s a situation where you’re faced with paying it off or losing needed income. An emergency savings account eases your worries. You’ll have more confidence facing unexpected past due bills that can make your enjoyable life a nightmare. Knowing you have a nearby emergency fund where you can transfer or withdraw money with a press of a button is comforting.

Car Repair

One of the worst things to experience is an emergency car repair. We rely on our car to take us to work, social settings, and hanging out with friends. Having a car breakdown on the way to work is terrifying because it could be your only means of transportation. An emergency savings account wipes out a good amount of stress in this situation. You can take on the expense like a pro or maybe get another car. Either way, you don’t have to freak out as much.

Job Loss

Most of us think our job will last for years. It’s never fun to hear about cutbacks and potential layoffs. We need income to survive and keep a roof over our heads. An emergency savings account with at least three months of funds is a good start. It should cover rent, moving, car, and health expenses. It gives you peace of mind where you don’t have to break down because you’ve been laid off. An emergency saving account is a lifesaver when done correctly.

Medical

We all try to eat right and put down the junk food. We exercise here and there trying to feel great when starting our day. However, our bodies can turn on us. Medical expenses, depending on where you live, are expensive. If you’re not in a state or country that has free medical care, then save for any unexpected health conditions. Learn what your insurance covers in case of an emergency, and put money aside for what they don’t cover. Your emergency fund must be able to handle unexpected out-of-pocket costs from the hospital or doctor.

Death

Death can occur at any time. As we get older, it seems to come more frequently, especially with those aging around you. A good plentiful savings account helps you lessen some of the blow of a relative who has died. You at least know you can pony up funds for a casket or moving expenses.

Interest

Today you can shop online for a high-interest barring savings account. It helps to put money away for a rainy day. The goal is to find an account where your money is getting a good interest rate and adding to your funds. Do your research to see which type of account suits your needs and wants. Understand a savings account isn’t for withdrawing money every time you need gas in your car. You’ll have to let your funds sit so the interest can accrue.

These are some of the best reasons you need an emergency savings account. Death can happen to anyone. Your savings account can help pay for expenses and soothe some of the grieving. Bills are a part of life. Pay them off with your emergency fund and stop worrying. Car repairs are a pain, but your car is a necessity. Extra money saved helps to get your car fixed a breeze. The economy changes over time and it may mean you need some additional funds if you get laid off. Your health is important. Put money aside in case you find yourself in the emergency room one day and paying a new bill. 

Savings accounts are a great way to earn money on top of your cash. Look for high-paying interest accounts that bring more benefits.

Veeramachineni Lalitha

I am Finance Content Writer. I write Personal Finance, banking, investment, and insurance related content for top clients including Kotak Mahindra Bank, Edelweiss, ICICI BANK and IDFC FIRST Bank. My experience details : Linkedin