7. Prepare in Advance with an Emergency Fund

The best way to avoid going into debt after an emergency — build an emergency fund. A nice sizable fund is 3 to 6-months of income.

To get started, deposit 10% of your paycheck into savings, plus any windfall you receive, such as a tax refund, gift money, bonuses or an inheritance.

You can't predict an emergency, therefore it's best to have money on hand just in case. Whether you're able to save $1,000 or $10,000, something is better than nothing. What are other ways to avoid getting into debt because of an emergency?

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