You should always have that amount of money on hand

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The emergency fund should be kept as a financial reserve. Consumer Center has a recommendation. (Iconic image) © K. Schmitt / Imago

Many things are now becoming more expensive. In order not to get into financial problems, the Consumer Counseling Center recommends creating a cash reserve.

KASEL – Because of the Ukraine war, the economic situation in Germany is very tense. Many things are becoming more expensive, including food, electricity and gas. This is often a huge challenge for private families, and in order not to fall into financial difficulties, it is recommended to invest in an emergency fund.

Because: Unplanned expenses can always happen, whether it’s repairing a car or paying a decent rent. The Consumer Advice Center recommends saving and allocating a certain amount.

Invest in a nest egg: this is how much money you should save

However, the term “nest egg” is somewhat misleading in this context. After all, a recommendation from a consumer center is a much greater amount of money. Specifically, this means two to three months’ salary. Of course, different life situations must be taken into account: after all, one family consumes on average less than a family of four. The latter needs higher contingency reserves in return.

But where should you stash the money? According to Consumer Center, piggy bank or checking account are rather bad ideas. Call money account is more convenient. After all, this was done to save money that is not currently needed. In addition, there is an overnight interest rate.

Egg nest for unplanned expenses: the best way to save money

But what is the best way to save such a large amount? After all, two to three months’ salary is a lot of money. This can be done, for example, in the following ways:

  • save piece by piece: A certain fixed amount per month can flow from the checking account to the calling money account. Depending on the monthly expenses, five percent of net income can be targeted according to the Consumer Advice Center.
  • Tax returns: If you are fortunate enough to receive a tax refund after filing your tax return, a portion of the money can flow directly into a call money account and be used as a financial reserve.
  • Christmas and Holiday Bonus: Christmas or vacation pay is a good reward for employees. If you take advantage of it, this can also be considered as a reserve cash reserve. According to the Consumer Center, one-third of the amount is a perfect guideline.

Basically, it is important to be prepared in time for expected price increases, for example increases in energy costs. If you have then saved up a good amount as an emergency reserve, you shouldn’t have financial problems so quickly. In the summer, you can also save a lot of energy – if you avoid some mistakes. (Progressive)

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