If this past year has taught us anything, it's how important an emergency fund is and why we should always have one built up.

In our last blog post we touched on how to build an emergency fund, but now we need to discuss how we can maintain it.

Where to keep it

The key to the emergency fund is that it needs to be available at the drop of a hat. The emergency fund doesn't need to be tied up in a system where you will be penalized for withdrawing your money early, or without a moments notice. A good option to keep your emergency fund is the standard savings account. The only problem with keeping your money in a standard savings account, is that it's almost too available. Keeping your emergency fund in an account that is this easily accessible will require a high degree of self discipline. If you are looking for a savings account that will keep your money ready and also work for you, check out the great Kasasa Saver account that MCT Credit Union has to offer. 

How to maintain it

Maintaining your emergency fund can be difficult depending on where it is being kept. Let's use the simple savings account example from before. Let's say that you are out shopping and you see a pair of shoes that you really want to buy. You check your budget and see that you have already spent all the available money in the "clothes" portion of your budget. Since your emergency fund is available at the touch of a button, it would be so easy to transfer a few extra dollars to your main account to purchase the shoes. But is this really something that justifies reaching into your emergency fund? The answer is very clearly no, but this is just one problem that you will have maintaining your emergency fund. If you're the type of person that might dip into your savings for that new pair of shoes, it might be a better option to keep your savings in a Certificate of Deposit, or CD. A CD could be a good option for long-term savings goals like buying a new home or car. If you have a time line if when you would make the purchase, a CD is a secure way to save that removes the flexibility of withdrawing money on a whim, and usually has a higher interest rate than a standard savings account. With some smart budgeting and some willpower, you can keep your emergency fund full and ready for anything that may come your way.

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