Imagine you're a contestant on a reality show and are about to cross a crocodile-infested lake on a perilously skinny plank. You've perfected your balance and you start walking … you got this. Except, whoops … you fall … right into a giant net just above an extremely toothy croc.
Well, first of all, phew. Secondly, have you thought about the usefulness of having safety nets in other parts of your life? What about one for your money? That's called an emergency fund and it can help you prepare for life's unpredictable and expensive moments. Planning ahead can keep you from relying on loans or using credit cards that could plunge you into debt. Most people keep their emergency funds in a savings account so that it's kept liquid, which means you can get it easily. It's also smart to keep this money separated from your other savings and investments, so you aren't tempted to use it.
As a general rule, adults should save enough to cover their expenses for 3-6 months in case they lose their jobs. But teens may not need that same cash cushion, so plan for what's comfortable and realistic for you. And don't worry if it seems difficult, you can start small by putting a little aside each week. Before you know it, your account will grow. And with this safety net in place, you'll never have to worry about becoming a croc's lunch.