Emergency reserve fund - while in debt
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If I am in debt, should I focus on building Emergency Reserve Fund?
Build up just one month’s worth of expenses in the security account and then concentrate on paying down the debt. Why? Because it doesn’t make sense to have money earning 1% in a money market account at the same time that you are paying 20% on your debt.
If you have debt – whether, it’s credit card debt, mortgage debt or student loans – it may not make sense for you to own bonds, or, to invest at all.