A cushion is cash set aside for surprises: a broken boiler, a car repair, a month without pay. Three to six months of your costs is the usual size.
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Without one, a surprise goes on a card at 19%, or you sell investments at a bad moment. The surprise costs more than its price.
If you spend €1,500 a month, three months is €4,500. The boiler and the car in the same year still leave €2,200.
Investing the cushion for more growth. Surprises like to come when markets are down too, and then you sell low.
Keep it where you can reach it in a day, in an account that pays some interest, apart from your everyday money.
Three months of costs in cash turns a surprise into a bad day, not a debt.
Do it today
Multiply your monthly costs by 3.
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