Basically the fund is cash money that just sits in a liquid account (savings, CD, online bank, etc.) to be used only in case of financial emergency.
And I am here to say that this concept of the emergency fund has SAVED OUR LIVES on numerous occasions.
Among other things it has paid for:
-a clutch that went out during our first year of marriage
-an engine fire that destroyed our starter
-termite guys to come and save our house from further infestation
-a head CT for Ellie
-a new washing machine
and, most recently,
-a new air conditioner to replace the 31 year old machine on our roof
So my testimonial is this: EVERYONE should have an emergency fund because EMERGENCIES happen to everyone. It doesn't matter if you only have $100 or even $100,000 as long as you have something set aside that you are adding to on a regular basis.
I know money is a touchy subject and that everyone has their own way of doing it, but there is nothing that has brought me more peace of mind when these bad things have happened than knowing that we have our emergency fund to turn to.
The end.
9 comments:
Seriously. Jacob has had a solid concept of this since day one, and boy has it saved us. I can't believe what a difference it makes in my outlook on our finances, the economy, etc. to know we'll be fine no matter how things go.
Amen!
My mom really wants me to have actual physical cash in case something really bad happens and we can't go to the bank to get our money out. But then you can't earn interest.... Either way, it's a smart idea!
Good counsel, Jord. Thanks to Jake for the good idea. Keep up the good work.
Amen, sister! It seems like it isn't possible to have too much in an emergency fund, either. There is ALWAYS something that pops up around here. And it seems like the more kids we get, the more expensive things get ;)
On the bright side, it must be nice to have a brand new air conditioner! Hopefully it ends up saving you some money on the utility bill or something! :)
Well said Jord! I couldn't agree with you more. I am always amazed at the peace and financial freedom you feel when you are in control of your saving and spending... no matter how much money you have!
I'm just glad you're getting rid of that crapola A/C. Maybe I will come visit you in the summer now.
Good for you Jord. You are a whiz with $$$ and you know how to handle it. You are so practical. For that reason, I hope you have a lot of it since you are such a good steward!
Sooo true! We have had to dip into our fund when our water pipe broke a few weeks ago.
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