There’s a lot of reasons to have extra cash set aside for “just in case” situations. Having an emergency fund gives you peace of mind if something unexpected were to happen. It gives you the ability to pay for setbacks without taking on debt, which inevitably, turn into more stress. It gives you the freedom to make the right decisions and focus on what’s important vs worrying about money.   In my household, we have two different emergency funds: short-term and .