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Here’s How to Rightsize Your Emergency Fund

Each January is a great time to reassess your emergency fund, the cornerstone of your financial well-being. 

The Importance of an Emergency Fund

An emergency fund should be in a safe place, like a bank account or high-yield savings account, with no risk of loss. 

It’s essential to make sure it’s big enough to cover unexpected expenses but not so large that you miss out on growth opportunities in other investment buckets.

Determining the Right Size

  1. Number of months you would need it to cover your expenses in an emergency
  2. Basic needs you’d need it to cover

Adjusting Your Fund

Regularly reassess your emergency fund, ideally once a year. If you find it needs to be increased, plan for it with potential bonuses or extra paychecks. If your fund is larger than necessary, consider reallocating some of the money to other financial buckets, like your personal escrow for travel or your retirement account.

The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Any opinions are those of Traci Richmond and not necessarily those of Raymond James.
Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize or sponsor any of the listed websites or their respective sponsors. Raymond James is not responsible for the content of any website or the collection or use of information regarding any website’s users and/or members.

Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize or sponsor any of the listed websites or their respective sponsors. Raymond James is not responsible for the content of any website or the collection or use of information regarding any website’s users and/or members.

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