What is an emergency fund? The concept of an emergency fund may have originated from the US. It is money set aside for for expenses from emergency hospital treatment or an unexpected loss of income.  Back here in Singapore, the conventional suggestion is also for everyone to create an emergency fund. Many have written about it such as this post by moneysmart. The usual recommendation is to have 6-12months of income as cash. I'd explain more on NEW FINDINGS. I used to think it has serious flaws... In my experience in financial planning, I've rarely seen emergency fund to be of much practical use. If you are already saving well, emergency fund creates a mindset of scarcity. In certain situations, it causes you to be overly conservative in how much cash to hold. Cash will be negatively impacted by inflation.
If you are NOT saving well, then implementing...