A broken TV can be one of life's emergencies. It has been inconvenient in that we cannot watch the news or a movie, although I can do without all the sitcoms and cartoons. The biggest inconvenience is that we have not been able to put the main room of our house back together, so there are pictures and boxes all over. Until a new TV finds its home, the rest of the house looks like warehouse.
Aside from that, a new TV costs money, and this is what an emergency fund is for. You never know what is going to break, crack, or stop working. It could be your air conditioner, a water line, or a fender bender. Accidents happen, so having an ample emergency fund is a great way to be prepared. Here are two ways to consider saving your emergency funds.
1. The "rule of thumb" is to have 3 - 6 months worth of expenses on hand. You can park these funds in a savings account or money market so that you can save regularly without too much temptation to spend the funds. This works for all categories of expenses and give you some wiggle room in case you spend some time not working.
2. Set aside money for specific expense categories. If you have a stable job, you may want to consider a smaller emergency fund, but still set aside money for other expenses. You may have a "House Fund" for anything around the home that breaks. Or a "Car Fund" to pay for insurance deductibles, tires or major repairs. Giving your savings a name will help you know what expenses come from your regular budget and what needs to come from savings.