Suze orman can you afford it

But Orman thinks that you'll need to have more money than that in order to be fully prepared. For many people, it's difficult to set aside enough in a bank account to cover even three to six months of living expenses. Saving enough to cover between eight months and a year's worth of costs could take a lot of time.

Still, if you have a precarious employment or health situation, then being fully prepared for emergencies could mean having a larger amount of money saved than is commonly recommended. You may also want to err on the side of a larger emergency fund if you are the sole provider for your household, and you don't have another income to fall back on.

However, you also have to consider the missed opportunities that may come from putting so much money into an emergency fund -- especially if doing so affects the amount you can save for retirement or other goals. High-yield savings accounts pay more interest than checking accounts or traditional savings accounts, but it's still not a lot of interest.

And the interest rate you earn may not be enough to ensure your money keeps pace with inflation. Ultimately, you'll have to decide what's best for you -- but you definitely want to be confident that your emergency fund is going to protect you from ending up in debt or being unable to cope with financial disaster.

And a one-year emergency fund, as Orman recommends, should provide plenty of cushion to have that peace of mind. Those are just a few reasons why our experts rate this card as a top pick to help get control of your debt. Read The Ascent's full review for free and apply in just 2 minutes. Christy Bieber is a personal finance and legal writer with more than a decade of experience. The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.

The Ascent is a Motley Fool service that rates and reviews essential products for your everyday money matters. Advertiser Disclosure We do receive compensation from some partners whose offers appear on this page. We have not reviewed all available products or offers. Compensation may impact the order in which offers appear on page, but our editorial opinions and ratings are not influenced by compensation.

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