Choose wisely. There is only one correct answer to each question.
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1.
You will likely need an emergency fund most when you're not financially stable.
True. People who are just starting out are usually most in need of such a fund.
2.
How much money should you keep in an emergency fund?
Your emergency fund should cover daily expenses for a period of three to six months at the minimum. If your income fluctuates, or if you're self-employed, you'd be wise to have more emergency cash on hand.
3.
An advantage to using an automatic savings account to build an emergency fund is that it _______.
Saves you time and energy on finding money to save. Putting your saving on automatic can free up time for other financial planning.
4.
Treating your emergency fund as a bill to be paid gives it an element of priority.
True. Usually, we can find money to pay our bills.
5.
A retirement account is not a good candidate to hold an emergency fund.
True. Retirement accounts require years to build up. When you take money out now, you can lose a lot of growth in future years.
