Build an Emergency Fund

An emergency fund is a readily accessible cash reserve that covers three to six months of essential living expenses. It serves as your financial safety net, preventing you from taking on high-interest debt or liquidating investments at a loss when unexpected costs arise.

In Canada, a high-interest savings account or a TFSA holding cash or short-term GICs is an effective place to keep your emergency fund. The goal is liquidity and capital preservation, not growth — this money needs to be available when you need it most.