Comments on: Do You Need an Emergency Fund? GS13

By: Victoria

Victoria — Fri, 20 Jan 2012 19:26:02 +0000

O’Neil this is great, and fun too! My emergency fund strategy is similar: I save all pennies and nickels in separate jars until full. I add to that all overtime pay and bonuses throughout the year. This is in addition to regular contributions. My goal is $3,000. (More than half way there). I only use for small emergencies right now — this way I’m able to pay it back faster. It is a GOD-SEND not having to take out loans or use credit cards. The best financial move I have ever made!

By: Paul

Paul — Fri, 20 Jan 2012 06:18:50 +0000

Great post as always.

I work at a bank, and see first hand how many people do and don’t have an emergency fund. It is scary how many people don’t, I would have to say about 50% of our customers are under funded in their emergency fund. Times are tough, and people just aren’t able to save as much as they use to. Saving just $50 a month is a great way to at least start building an emergency fund.

By: Oneil

Oneil — Thu, 19 Jan 2012 02:05:39 +0000

One easy way I like to save money. Every time I purchase merchandise at any business In which I pay cash for, this is what I do, instead of giving the clerk change out of my pocket I always break another bill so I can keep all of the loose change in my pocket and when I get home I take all of the change and drop it into a jar of bucket. Often I will add a few paper bills such as a couple of dollar bills or maybe a bigger bill if I feel I can spare the extra money that day. Then when the container gets to a point it becoming full I take the change and bills to the bank and have it counted and deposited into my savings account. You would be amazed at how much has adds up over a years time. I would recommend not letting the amount of change get out of hand before cashing it in as it could be a problem. My bank does not charge me for running the change through their machine but some banks might object if the quantity of change is high. It is one easy way that I have found to help me save some money. I have done this for many years now and it has become second nature for me. Try it for yourself and I am sure you will be pleasantly surprised.

By: Doug

Doug — Wed, 18 Jan 2012 21:02:58 +0000

The freedom you feel having $1,000 in savings, and the ability to cut up “all” of the credit cards is simply “incredible”. Positively, simply, incredible! I can’t even describe the weight that has been lifted off of our shoulders…

By: Cherylcat

Cherylcat — Wed, 18 Jan 2012 20:26:27 +0000

Establishing an emergency fund is the MOST important step anyone can take toward financial peace and control of money! Having CASH in an emergency fund means there’s money for unexpected expenses that sent you running to the credit cards before. We’ve built (and spent) our emergency fund THREE times; the 1st time we hit it I freaked out! But that’s what its there for. When we needed major car work, an unanticipated emergency with our out-of-state son, un-covered medical, the credit cards stayed in the drawer and we had money to pay for it. You find you can handle a financial sideswipe and begin to feel control, even power over your money, instead of it having power over you.

By: Jeff Schwandt

Jeff Schwandt — Wed, 18 Jan 2012 15:03:12 +0000

Working the budget with my wife has made a huge difference in how our money is handled. Not only are we benefiting from her wisdom, but I’m also learning how to communicate better with her. It was her wisdom that pushed us to set aside a Contingency fund for emergencies and to cover deductibles. The overall goal is about $15,000, with her help and the HSA at my job, we’re almost to 50% of that goal. It’s nice to know that you’re prepared.

By: Ronnie

Ronnie — Mon, 12 Dec 2011 03:28:06 +0000

My first emergency fund had only 2-3 months of expenses. That was a number of years ago.

Today, I’ve got one for 5 years worth of expenses plus a relocation budget, in-case I need to move for a new job.

Also, I’m only buying real estate with the idea of using the place for retirement. I currently rent it out, seasonally, for vacationers. That’s covered the taxes and maintenance costs. Otherwise, I rent a cheap apartment so that I can be mobile for work. The mortgage on the property is 15 years.

I believe that in the years ahead, those who can move easily for work, will be marketable. Granted, it would be nice to be near one’s hometown (or general place of roots) but that’s not the economy, looking ahead.

Like many others, I don’t want to be a renter during retirement, however, during the active part of my career, it’s not a bad way to go, in terms of being able to move to where the jobs are at.

By: JB

JB — Mon, 31 Jan 2011 22:17:19 +0000

Dear Bob et al:
The other difference between having an Emergency Fund and not having one is the fallback position: If you spend $50 extra a month on debt, you may well pay off a few debts a little faster. But when (not “if”) an emergency happens, you will be forced to take out more debt in order to deal with the emergency. Ask an airline for a “bereavement” fare (sold on an “emergency” basis to people facing an unexpected funeral) and you’ll quickly discover the world’s lack of sympathy for you: They’ll actually charge you more for it! Same with emergencies. Most banks won’t give you an “emergency” loan on reasonable terms. Instead, they’ll offer a “personal” loan at a ridiculous interest rate. Credit cards, of course, are even worse. So you will always be better off with a buffer zone; banks know this. It’s why they offer “overdraft protection”. Difference between the emergency fund and the bank’s OP plan: A hefty percentage of interest and fees.

I don’t charge myself interest and application fees on my emergency fund…which is why it’s a better idea to have one.!

By: ali raza

ali raza — Sun, 14 Nov 2010 08:48:56 +0000

excellent article, nice way to start, here in Pakistan financial situation is not much different from US but earning capacity is much different, I also start saving 5000 pak rupee = round 50 $. let see how much time i require to reach equal to 10000 $. But i successfully paid all my credit cards a just a few days back, this change happened after reading articles on Chirstianpf, i am by the way not christian but i believe that Jesus is for every one.

By: harvestwages

harvestwages — Fri, 19 Mar 2010 16:41:19 +0000

Hey Bob,
We all need emergency funds. i support to David Ramsey approach of building up $1000 emergency fund and then start paying debts.