How to manage emergeny fund

POSTED BY edebasis ON January 11, 2012 12:23 pm COMMENTS (4)

Hi ,

I am planning to create an emergency fund for my below needs

1 : If my regular salary income gets disturbed, I should have this fund which will take care of my home loan, insurance installments and bare minimum monthly expenses.

2 : For any medical, family emergency.

My query is, where to invest the amount to create such funds.

Need your expert opinion.

Thanks a lot in advance.

4 replies on this article “How to manage emergeny fund”

  1. Dear Edebasis, Here is my view –

    1. Keep 2 months expenses in auto sweep FD account as discussed by others. Keep remaining 4-6 months expenses in liquid or short term debt funds.

    2. The health or medical emergency fund as the time frame is not certain, keep it into long term debt funds.



  2. Narayan says:

    The emergency fund for your income disruption (if any) should be in bank sweep-in accounts or liquid funds depending on how much your monthly expenses are. If your monthly expenses including the liability is over Rs 50,000 think of a liquid fund.
    As far as medical emergencies; there is nothing better than a health insurance policy.

  3. You may park your money in Liquid, Liquid Plus Of Short-Term Debt Fund time to time.Its More Liquid than FD of a Bank.

    Prabir Sharma
    M/s. Feel Bureau Of Financial Planning.


    One of the best way of investing the emergency funds is to keep in Auto – Sweep acc.

    the link for that

    In SBI this is called as saving plus account.
    In that especially on a particular date the amount available above the threshold will be put into the fixed deposit . whenever u want u can withdraw it in ATM itself. it will earn fixed deposit interest for the period it is with bank.the amount which is in FD (you can see it in the online internet banking acc) will be shown as MOD balance in the sbi internet banking acc.


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