ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -An emergency fund is the money that is set aside so it can be used during uncertain situations. It acts as a safety net during job loss, medical emergency, or unexpected expenses.

Detailed explanation-2: -Most experts believe you should have enough money in your emergency fund to cover at least 3 to 6 months’ worth of living expenses. Start by estimating your costs for critical expenses, such as: Housing. Food. Health care (including insurance).

Detailed explanation-3: -Unforeseen expenses means living costs which were unexpected and cannot be avoided.

Detailed explanation-4: -Some common examples include car repairs, home repairs, medical bills, or a loss of income. In general, emergency savings can be used for large or small unplanned bills or payments that are not part of your routine monthly expenses and spending.

Detailed explanation-5: -Across the 15 largest U.S. metro areas, these are the average amounts for six months’ worth of expenses: Single adult with no children, $12, 660. Single adult with one child, $25, 274. Two adults with no children, $18, 554.