Emergency Funds Are Vital. Here's Why.
Nothing is less sexy than an emergency fund. Save up enough money to cover your basic expenses for three-to-six months. Put that money in the safest place possible -- like a money market account. And then let it sit there.
Over time, it will lose value due to inflation. You'll have to put more in if your household grows. And there are opportunity costs: The longer the fund sits there, the more potential money you've missing out on because it wasn't invested in the stock market.
And yet, this seemingly wasteful decision will still be a life saver -- if not for you, than for your children and grandchildren. See why below.
Source Fool.com
