New Delhi, Oct. 9 -- The role of an emergency fund is to provide immediate financial support during a crisis. It should be readily accessible when unexpected expenses arise, such as medical bills, accidents, job loss or other financial emergencies.

Building an emergency fund requires careful planning, particularly when balancing liquidity, capital safety and reasonable returns. For a Rs.5 lakh emergency fund, choosing the right mix of financial products is essential to ensure the money remains accessible when needed.

Savings accounts, bank fixed deposits (FDs) and liquid mutual funds serve different purposes. Understanding their features, potential returns, withdrawal timelines, and associated risks can help individuals make informed de...