Definition
Money set aside for unexpected costs, like a job loss, car repair or medical bill, kept somewhere safe and easy to reach.
The story
A common rule of thumb is three to six months of essential expenses, often in a savings account. Its job is to keep a surprise bill from turning into credit card debt or forcing you to sell investments at a bad time.
Why markets watch it
Many financial education programs start with it, before investing.
See it in the story
Connects to
We explain why it moves markets. What you do with it is your call. Commentary and education only. Not financial advice. All terms