When it comes to emergencies, what do comes to mind is negatives occurrences. Is it really true? Can't there be positive emergencies?
Emergency refers to unexpected occurrences or events.
Finance on the other hand refers to money so Financial Emergency can be regarded as unexpected occurrences that requires financial obligations.
This alone makes it look as if all emergencies are negative one since they are all unexpected but if there are unexpected occurrences that does not require financial obligations then there can be positive financial Emergency.
Types of financial emergency
Negative emergency: I will like to start from what we are accustomed with which is negative emergencies such as accidents.
Positive emergency: Yeah, there can be positive emergency and this are things that call for joy and celebration but they are not expected so they are emergency such as promotion. This is positive but when the promotion requires you to relocate then you will have to spend on what you did not planned for like getting a new accommodation or getting a new outfit among others.
From the above, it can be seen that financial Emergency can also be positive as long as the event is unexpected and it requires financial obligations.
How do I prepare for emergency?
Emergency can not be avoided either negative or positive but the only thing that can be done is to be prepared for it.
The only way to prepare for emergency is to save.
Your savings alone is what will save you but we have come to the time when inflation is at its peak and money saved keep losing value.
Those into cryptocurrency are not affected so much since crypto assets are bound to increase in value thereby negating the influence of inflation.
Even at that, there are emergencies in cryptocurrency like buying the dip and surviving the dip.
Savings might not be enough to save us that's why a proportion of our savings should be invested while part of it should be saved in fiat or stable coin. This will give us the opportunity to have necessary cash when needed and also the investment part will help us to even out the effect of inflation and also serve as a means of creating wealth.
When making investment, don't invest on what you did not understand. Even in cryptocurrency, there are fractions. Some people are good in spot trading, some invest on future trading, some invest on presale and degens, some are involved in NFTs while some are just earning through writing contents or working as part of a team.
Invest on what you understand but that doesn't mean you should not extend or diversify but don't diversify unless you have the basic knowledge. This will help you to protect your capital.
Financial emergency requires savings if you want to be prepared for it but savings alone cannot save you, you should also invest a part of your savings.
Till I cross your path again, I am like a ready made pen in the hand of the creator. I am
A²¹
