Having an emergency fund reduces anxiety around money and provides the necessary funds when you need them. Establishing your emergency fund is easiest if you automate a transfer to the separate account with every paycheck you receive. You should strive to have 3 to 6 months of living expenses available in emergency funds. Available credit on your credit cards is not an emergency fund as a card issuer can reduce your limit at any time.  Emergency funds work best if they are kept separate, e.g. in a separate high-yield savings account or money market fund.