Educating the Filipino: What is Emergency Fund? Why do we need Emergency Fund?

The Minimum ideal allocation of your Emergency Fund should be equivalent to your 3 months Living Expenses or 3 months monthly income. Example an average Filipino is earning P12,000 in a month, he should have an emergency fund of 3 months x P12,000 = P36,000 To start to building your Emergency Fund, it is suggested to put the 10 percent of your monthly income to your fund. To continue our example 10 percent your income is P12,000 x 10% = P1,200. In doing the example you will complete your Emergency Fund P36,000 in 30 months or 2 1/2 years.