Get one. I am always suprised by how few people have one. You should try to have at least a three month emergency fund. Three months worth of total take home pay for the family. Eventually, you should try and work up to having a six month emergency fund.
A three or six month emergency fund is a significant dollar figure for most families. Keep one month completely liquid in your regular savings or checking. Put the other two or five months in a high interest earning money market account. Money market accounts are one of personal finance’s best kept secrets. They are similar to savings accounts, but with two key differences. They pay much better interest rates and you are limited to the total number of transactions you can make.
Research the best rates in money market accounts around the country on the great website: http://www.bankrate.com/
Exactly true. It is amazing how many people tell me, I don’t need an emergeny fund, I have credit cards. Craziness.