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Everyone needs anemergency fund.
If you dont want to live on the edge of financial ruin and debt, you need anemergency fund.
But if youve never saved an emergency fund, how do you get started?
Get Clear on Your Mandatory Living Expenses
What bills do you gotta pay to survive each month?
These include all housing-related costs, transportation, food, and insurance.
And ensure you includehealth insurance premiumsand any other mandatory insurance bills, as a monthly cost.
Tally these up these make up your monthly necessities.
Not exactly advanced calculus but the harder part is execution.
In the example above, that comes to $750 each month.
If youre used to spending most of each paycheck, that might feel uncomfortable.
And if the monthly savings demand turns out to be too great, scale it back.
Still busting your budget?
Divide by 24 months instead ($375), and hit your target within two years.
But financial success starts with financial security and that requires an emergency fund.
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