Question

Which choice or choices best describes the purpose of an emergency fund?

Answer 1

An emergency fund is a financial safety net for future mishaps and/or unexpected expenses. Financial planners recommend that emergency funds should typically have three to six months' worth of expenses in the form of highly liquid assets. Savers can use tax refunds and other windfalls to build up their fund.

Answer 2

Answer: Just as the name implies, an emergency fund is a fund set aside against unforeseen future occurrence. This fund can be taken to handle impromptu situations requesting fund to offset them. It is very important in a human life to have this because there will always be a rainy day when no one expects it will rain.