Common Reasons People Turn To Emergency Funds

Emergency expenses arise at the most inconvenient times. Oftentimes, people have to reach into resources such as savings accounts to pay for them. If they lack the savings to cover the cost, they turn to payroll advances, credit cards, or installment loans. These and other sources of non-savings emergency funds are critical to those in times of need.

If you don’t think you have to worry about this situation happening to you, just consider some of the most common reasons people turn to emergency funds:

Car Problems

Car failure is the number one reason that people have to dig into emergency funds. A variety of issues come about such as tire blowouts, overheating problems, alternator fails and so on. People often have to gather emergency funds for tow trucks and then repairs at a local auto garage. Car issues are often costly and can range from $200 all the way up to several thousands of dollars.

Home Repairs

Home repair jobs are another sector of emergency services that spring on people when they least expect it. The most common home repair is the hot water heater. Plumbing repairs and random HVAC repairs are also common depleters of emergency funds.

Health Issues

The current health insurance structure is so financially devastating that many people find themselves in a bind when they have a health issue. Workplace injuries, advanced diseases, accidents, and dental problems are common in the world today. The costs can be massive for a person who doesn’t have insurance. Even people who have insurance sometimes have unattainable deductibles that don’t offer much help to them. These individuals often hit emergency funds when such problems arise.

Legal Problems

Legal problems are another sector of issues that often come up. A driver may receive an unexpected ticket that he has to pay. Alternatively, he may want to hire an attorney who can fight the charge that he is battling. Another scenario that often comes up is that a family member or friend will ask for help because of an issue that he or she is having with the authorities. That person may need bail money to get out of jail. The person may need money to hire a lawyer. The individual may ask a close friend or family member to help, and that person will have to dip into the savings fund. Such incidents can be quite draining on the person’s livelihood.

Moving Expenses

Moving expenses also creep up on people sometimes. A person may have to move suddenly because of a job change, a desire to improve their life, or some other sort of personal issue. The costs can be high, and they cover several things like the home rental, moving van rental, moving supplies, utilities, furniture and so forth. Someone may have to quickly gather funds for this task.

Another notable reason that someone may need to hit the emergency funds is school expenses. The person’s children may be starting school and might need uniforms and such. A college student may need books or money for personal needs. Education can accumulate many expenses that call for a savings raid.

Those are some of the most common reasons that people have to use emergency monies. The best way to combat surprise money needs is to put some savings in the bank every pay week. Create an account just for emergencies and then you will have it when the time comes. You can set your direct deposit to put the money into the special account before you even see any of the rest of your funds. That way, you won’t miss the money, but it will be there when you need it the most. Start saving today so that you will have what you need when an emergency strikes tomorrow.

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