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7 Smart Ways to Build Your Emergency Fund

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Read enough articles here on Kiplinger.com or in Kiplinger's Personal Finance magazine and soon enough you'll get our emergency-fund lecture: Squirrel away six months worth of living expenses. Shelter it from market losses. Keep it liquid. Tap it in the event of a job loss or medical emergency to avoid raiding your retirement savings or racking up debt.

Sound advice, to be sure. You don't want to scramble for money when your furnace quits in the dead of winter or your car breaks down en route to work. Sudden costs don't have to end up on your credit card bill, putting you on a path to uncontrollable debt, says Andrew Schrage, co-owner of the Money Crashers personal finance website.

But for many people, amassing an emergency fund is easier said than done. After all, for the average American household, six months of living expenses adds up to nearly $30,000. That's a lot to save, especially when you're supposed to stash it in a low-return, high-liquidity account that won't add much in the way of compounding. Indeed, 52% of families say they don't feel financially prepared for the unexpected, according to a recent report from the Pew Charitable Trusts.

If you're struggling to imagine how you'll ever put aside $30,000 or more, consider these seven practical ways to start building an emergency fund now.

SEE ALSO: 70 Time-Tested Tactics to Build Your Wealth

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