Given the importance of having an emergency fund, there’s a lot of discussion among financial experts about whether building your fund should be your top money priority. However, there’s no easy answer to this question. Instead, it will likely depend on your specific situation as well as your financial goals.
For example, if you have high credit card debt, it may make more sense to focus on paying down your balance than to set money aside for your emergency fund. Another common conundrum is that workers may wish to prioritize their retirement savings, leading them to take longer to grow their savings. Ultimately, it’s up to you to decide what strategies and priorities make sense for you. In the first scenario, perhaps you focus on your highest debt but set aside $20 a week for your emergency fund. As for the retirement investment question, you may decide to max out your employer 401(k) contribution matching but then direct other funds to savings.
Instead of worrying about where on your priorities chart an emergency fund should fall, set a goal for how much you want to have saved by certain dates and work from there.