Create an emergency fund

Part 4 in a 12 week series on debt recovery

Woman at a desk looking at her cell phone

You may be feeling impatient to start more aggressively paying down debt, but first it’s important to create an emergency fund. If you don’t have money socked away for unexpected expenses, you’ll be tempted to use the money that’s already earmarked for your debt payments to fund this expense.

Common uses of emergency funds:

  • Situations such as inclement weather or medical bills
  • Home repairs such as broken washer/dryer or a burst pipe
  • Living expenses if you lose your employment
  • Car repair or one-time maintenance needs

Experts recommend keeping three months’ worth of living expenses in an emergency fund, but you can start with a more modest amount and grow from there. 

A good first step is to set up an automatic monthly or weekly transfer from your TwinStar Credit Union Checking Account to your Savings Account until you have a fully padded emergency fund. This may take several months, but no worries, you can continue following the next few steps toward a debt-free life as your emergency fund grows.


Read the whole series: 12 weeks to a debt-free life

  1. Take stock of your debts
  2. Don’t dig yourself deeper
  3. Negotiate a lower rate
  4. Create an emergency fund
  5. Coming Soon


TwinStar Credit Union is federally insured by NCUA.