Lesson 1 of 3 · 6 min
What an emergency fund actually is
Money set aside for the month that goes wrong, parked somewhere you can reach in a day without losing any of it. The test is not how much it costs.
A job ends. A hospital wants a deposit before it admits your father. The phone you need for work dies on a Tuesday. An emergency fund is money you put aside beforehand for exactly those months. It is not savings for a goal, because it has no goal. That is the point.
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Emergency, or just an expense you did not plan?
Your laptop dies and you need it for work
The test is not how much it costs. It is whether it is sudden, necessary, and would otherwise be paid for with debt. An unplanned expense you can absorb from this month's salary is not an emergency; it is just a surprise.
Just for you
Think of the last time money went wrong for you or your family. Where did the money come from? A card, a relative, a loan, savings?
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Kabir asks
Your cousin's wedding is in four months and the outfit alone comes to ₹15,000. Emergency?
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