What if your car breaks down, the roof leaks, or the TV dies? Can you get enough cash, quickly, to handle emergencies? Or, to take advantage when a great opportunity comes along – like a special deal on a new computer, a great clothing sale, or that sell-off vacation you always dreamed of?
The usual rule is you need to save enough to pay today’s bills plus living expenses for three to six months. What’s right for you depends on whether you’re single or raising a family, how much you earn, and the other choices you have if you need money fast.
Where should I keep my emergency savings?
You may want to consider investments called "cash equivalents." These products are a lot like cash. You can usually get your money out within 90 days or less. Cash equivalents include:
· Chequing accounts
· Savings accounts
· Tax Free Savings accounts
· Money Market Funds
· Canada Savings Bonds
· Cashable Guaranteed Investment Certificates
With cash equivalent products, there is little risk of losing money and you often know how much you will make. Many are guaranteed to not loose capital. Just be sure you understand when you can get your money out – and if there are any special fees or penalties for early withdrawals.
For more information, check out my web site at www.freed.ca or give me a call at 416-806-5478