If the last 18 months has taught us anything it’s that the unexpected can happen at any time, including unexpected debts due to losing a job or losing a home to a natural disaster, not to mention unforeseen healthcare costs due to the pandemic.

That’s why it’s more important now than ever before to have an emergency fund. It is one of the most effective tools to prevent large-scale financial disaster. An emergency fund is an amount of money that is set aside to cover unexpected expenses or to keep you afloat if no regular income is coming in.

Begin by reviewing your monthly expenses. If you suddenly lost your job, what bills would you absolutely need to pay? This would include your mortgage or rent payment, utilities, insurance, transportation, and food. Ideally, your emergency fund would cover six months of these necessary payments.

It’s probably not practical or possible to create a fully-funded emergency fund all at once. Instead, open a separate savings account that you add to on a regular basis. For instance, if you get paid every other week, consider making an automatic transfer on each pay day. You can set up automatic recurring transfers through First Citizens Online Banking, learn more here: https://www.myfcb.bank/online-mobile/online-banking

For more information about emergency funds, and to learn practical ways to add to your fund, visit this Banzai page: https://myfcb.teachbanzai.com/wellness/resources/emergency-funds