There are always bills to pay and money needed for something or another, and few things seem as boring and unnecessary than an emergency fund. While you can enjoy the rewards of spending on, say, a good winter coat, or can see the benefits of saving for something like university for the kids, emergency funds are, by nature, never seen.

Which is why most South Africans don’t have them – and open themselves and their loved ones up to serious hardship and, ultimately, spending a lot more money.

Here’s why you need an emergency fund:

To keep your life goals on track

Most people operate in a space of barely having ‘enough’ or not quite ever having ‘enough’. Granted, we can have a discussion around what ‘enough’ really looks like, but for most of us, the former sentence is the reality.

This means that we can’t afford a major tragedy – even more so if we’re not insured for it – and still keep financing life as if nothing has happened.

An emergency fund can help you avoid having an unforeseen emergency (or multiple emergencies) derail your life. Many of these unforeseen circumstances involve medical or health issues, which are expensive. An emergency fund of three-to-six months of income works well in conjunction with risk cover.

To reduce the impact on your dependents

If you provide an income or lifestyle for others in your family, having an emergency that cripples your finances will impact them too.

This could impact living standards, educational opportunities and their access to care should they need it. Knowing this creates increased stress and extends the time of recovery from an accident or traumatic event. If you’re able to reduce financial stress you can have more energy available for the other healing and recovery that is needed, for you and those who depend on you.

To keep yourself away from truly bad debt

People panic when they have unforeseen urgent circumstances and no safety net cash for them. If they can’t rely on their kids or the problem is bigger than that, debt becomes the only way out of the immediate problem.

Under this pressure, we can get into all kinds of jams. Loan sharks, paying off nothing but interest for decades and surety clauses which mean things like having to give up your house are all real things that happen to real people. Don’t be one of those people.

Misfortunes in life happen, they’re a guarantee – just like the good things in life are. We plan and set aside money for positives like getting married, advancing careers or having children, but we don’t realise that by failing to plan for the unfortunate surprises too, we put those very good things at risk.

If you need help with this, then let’s get in touch – because you never know when your emergency will be.