According to a 2023 survey, 63% of workers said they would be unable to cover a $500 emergency expense.
This means a majority of Americans don’t have an emergency fund, which is a savings account with roughly three to six months of living expenses set aside for unexpected expenses.
If you can, you should be working on building emergency savings. Even a small amount can add up over time. Learn about the most common reasons to tap your emergency fund.
Job Loss
Losing your job can be financially devastating, especially if you’re the primary earner in your household. Even if you qualify for unemployment benefits, emergency savings can help you keep up with bills.
Emergency Home Repairs
Homeowners can plan and budget for routine maintenance and repair tasks, but expensive repairs may arise suddenly. For example, a storm blows through and knocks a tree branch onto your roof or floods your basement. Whatever happens, it helps to have emergency savings to cover the cost without going into debt.
Major Car Repair
As with your house, your car doesn’t always give a warning before breaking down on the highway. Whether you have trouble with your brakes, engine or tires, having money saved up can get you back on the road.
Medical Expenses
Nearly half of American workers are enrolled in a high-deductible health plan, according to the most recent federal data. This can result in costly bills if you or one of your dependents has an injury or needs diagnostic testing. If you have access to a health savings account, you can save for medical expenses with pretax dollars. If not, your emergency fund will come in handy.
Do you have questions about your insurance coverage and how it could help you save in case of property damage?
Get in touch to talk about your policy.
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