How does having an emergency fund impact my overall financial plan?

Having an emergency fund is an important part of an overall financial plan. It provides a safety net in case of unexpected events, such as a job loss, a medical emergency, or a major home or car repair. Without an emergency fund, people may have to rely on credit cards, loans, or other forms of debt to cover these expenses, which can lead to financial stress and hardship.

By having an emergency fund, individuals and families can have peace of mind knowing that they have a financial cushion to fall back on when unexpected expenses arise. This can help them avoid highinterest debt and keep their overall financial plan on track.

In addition to providing a safety net, having an emergency fund can also help people achieve their other financial goals, such as paying off debt, saving for retirement, or investing in their future. When unexpected expenses arise, having an emergency fund can help people avoid tapping into their other savings or investments, allowing them to continue working towards their other financial goals.