Personal finance experts advise on building emergency savings

Financial experts are highlighting common mistakes in personal saving habits and the importance of establishing a financial safety net. A financial cushion is designed to cover unexpected costs such as medical emergencies, vehicle repairs, or loss of income, helping to prevent debt and reduce stress.

Experts suggest that an optimal emergency fund should equal three to six months of essential living expenses, including rent, utilities, food, and transport, rather than a full month's salary. Three months is considered a minimum for short-term difficulties, while six months provides greater security during prolonged unemployment.

To build these savings effectively, financial advisor Jakub Kurek recommends avoiding drastic budget cuts that lead to frustration. Instead, he suggests starting with small, manageable amounts, such as 5 to 10 percent of monthly income. Additionally, keeping all funds in a single current account is cautioned against, as it can lead to impulsive spending. Separating savings into dedicated sub-accounts helps maintain a clear boundary between daily spending money and long-term capital.