Emergency savings 101: how to prevent unnecessary debt when the unexpected happens
Empower: 37% of Americans could not afford an unexpected bill over $400
(InvestigateTV) — A recent Bankrate report found that 37% of Americans needed to use emergency savings in the last year for things like an unexpected doctor’s bill, car repairs, and other unanticipated expenses.
Whether it’s a surprise medical bill or a car that won’t start, having extra cash on hand is essential to keeping your budget on track.
Kionnie Epps, a financial educator from the popular website and YouTube channel ’The Responsible Homegirl,’ said having money set aside for emergencies is key to any budget.
Epps advised people to set a goal now to build a savings cushion by setting aside three to six months’ worth of expenses for unexpected emergencies. Make the savings automatic, even if it is just $25 dollars of every paycheck.
“When an emergency happens, how do you respond to it? Do you immediately swipe that credit card? Do you pick up the phone and call a friend or family member? Do you go take out a personal loan?” Epps asked. “So, emergency funds set up a security blanket for you that you can rely on later on. Every time you borrow money you are taking money away from your future self.”
She said emergency funds help prevent financial stress and protect you from falling into unnecessary debt when unexpected expenses arise.
“There are always going to be ebbs and flows of life, but I feel like when you’re prepared it takes away a little bit of that stress,” Epps shared. “Yes, it still may be an inconvenience but because you’re prepared you just handle it. You just respond differently, you just respond better to it.”
She said finances and budgeting are already stressful, but being prepared for an emergency can take away some of the stress.
Copyright 2025 Gray Media Group, Inc. All rights reserved.
