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Have You Got an ‘Emergency Fund’?
In these times of uncertainty perhaps starting an emergency fund could be a good idea. Typically an emergency fund is a personal budget that you put aside as a financial safety net for future unexpected expenses.
I started one a few years ago when my daughter needed some medical help on her spine after she fell off a horse. Unfortunately the private healthcare package didn’t cover all the specialist treatment so I needed to start putting money aside for it.
The experts recommend somewhere in the region of three to six months’ of living expenses to create a secure financial safety net but as we have seen with the recent COVID pandemic it may be prudent to stretch this to a year’s worth and with my daughters treatment it is still ongoing 2 years later!
The reason to have an emergency fund is pretty straightforward in that you just don’t know what’s going to happen from suddenly losing your job, an emergency operation etc. Many so-called emergencies repairing your boiler, replacing your washing machine or fixing your car are not true emergencies. These type of things are expected and you know these things will occur at some point.
Who’s got one or thought about it?
I don’t have one but having it would be great because nobody knows what tomorrow will bring
Sure
Sorry about your daughter, hope she recovers fully. Good idea to have such a fund for that needed security. We usually have insurance and medical aid but these are sometimes inadequate and an emergency fund becomes necessary.
Emergency fund is very important and useful.no one knows what will happen tomorrow or even after one hour later in the near future. So by having an emergency fund aside can help us to solve some unexpected problems .
I should know.I am struggling to build that.It is so true.No-one knows what will happen in the long run even if you plan and live your life in an organized way.I definitely do not ft ink that any of us saw this coming.So this gives me motivation to get started.
Sorry about your daughter, wishing her a speedy recovery
I have always thought about having an emergency fund, especially after experiencing this covid-19 pandemic, the need for it can not be overemphasize
I have not yet started one but I realize it’s neces important to note that it’s now a necessity to have an emergency fund for everyone. This covid19 pandemic has created a big impact in everybody’s life, let it positive or negative.
Thank you for bringing the topic about emergency fund!
When you mentioned it, I took it upon myself to tell a few friends about it and has sparked a discussion here at my work place. We have been discussing about it with colleagues about how helpful it can come to one’s rescue. I think an emergency fund is more less like an insurance policy, if I have an insurance policy, it protects me against unforeseen uncertainties like sickness, accidents and so on. However, insurance policies cover certain specific risks as stipulated within that particular policy. Therefore, in this particular case, an emergency fund will cover any risks that befalls the holder that an insurance policy may not be able to cover. Thank you very much, you have made our day here.
Nowadays is necessary to have an emergency fund. After what I passed through the lock down, I will dedicate at least 18% of my monthly income to save as emergency fund. I never know what will happen tomorrow or in the near future.
Having emergency fund will actually help you to solve some unexpected problems.
I never planned an emergency fund. But I have some capital in my keeping. The reason I am not planning for an emergency fund is because I don’t want to unconsciously invite those ’emergencies’ into my reality. I believe in my ability to meet any future contingencies where those contingencies arrived.
I think, now more than ever, we have got to rethink our life decisions. Emergency fund is something, that rarely comes to my mind. This is because, how do you strst such a fund when you are already in emergency? But now, with financial freedom that I’m working on to achieve, this can be possible.
An emergency fund is very difficult to have especially when you are still in emergency conditions,the only saving l have is social security fund which is only accessible at 50 years.
But with luckscout.com soon l will have an emergency fund
Emergency fund is used during the time of unemployment. Usually it is suggested we should keep at least 6 months of our current salary. For a salary of usd 2k , We should keep at least usd 12k in a savings account. It takes an average of 6 months to find a new job . During this time , we withdraw same amount of money , it’s 2k from our account for our monthly expenses . So we are safe at least for 6 months.
I have a small emergency fund that will not last very long and I have my retirement savings that I would be able to access if really required and this would pay my mortgage. This is the reason that I am here pushing as hard as possible to kick some goals and earn some money to make up for what I have lost over the years trying to get the life that I would like to live.
Thanks gw
I’ve never had an emergency fund in the past,but what I experienced during this pandemic give me ideas that it’s very important and hopeful to have such a money by my side.
Great to see some conversation on the topic and that’s what its all about – talking about ideas to see if they suit us as individuals. Making us all more aware
After passing all the lock down in trouble. I must have an emergency fund to prevent unexpected moment, events,or issues. It seems to be important to have an emergency fund aside.
How does your daughter situation now? I hope she is going well.
Yes, the amount of at least one year living expenses is sound for an emergency fund. For the expected expenses such as car repair, of course it should be excluded from the emergency fund beneficiaries.
However, what would you do with the emergency fund, if, for example, there is no emergency situation in a long period of time, say for 10 years?
If we keep the fund in the bank for a long time, I think it would not keep up with the inflation.
It is advisable for a person to have one, especially a family in order to meet emergency or unplanned needs in future. I strongly buy the idea of having an emergency fund because no one knows what tomorrow may bring.
An emergency fund is a necessity – you’ll never know what’ll happen next in this turbulent world we live in.
My intention is to setup one now and follow the rules strictly. I have learnt a big lesson.
I think it certainly lifts a little stress from your life if you know you have an emergency fund to back you up financially should a crisis happen
I don’t have any emmergency fund for now, I’m conscious that I need to find it. I will dedicate some of my income for that.
I have some saved money that can act like an emergency fund. It is not the best economic thing to have much money on a money saving account. It is better to have insurance that cover different unexpected situations. K
What i learned during the outbreak of corona virus and the lock down was a great lesson learned. I decided from now in to always have an emergency fund aside it very important to have it. Sometimes we have unexpected things, situations, diseases, trouble, accident at anytime. It really helpful for these emmergency situations.
Great to see everyone is at least thinking about the emergency fund and that’s what my question was all about. Thanks for your responses
Of course Mr Edward,your question was very helpful and it makes me think of having an emmergency fund for unexpected moments like diseases, troubles,etc…
We are now aware about it.
I still haven’t prepared an emergency fund. My current condition is poor. It is difficult for me to find a job, especially with a pandemic like now.
Yes, I have got emergency funds before and still expecting another one.
Hi, Mr Steinar.
I agree that we should not put too much money on the bank. I think for an emergency fund, an amount of at least 5 times our monthly income is enough. Any number beyond that amount should be allocated on the more productive investment. Keeping too much money on the bank will only make the bank gets richer while our money value can’t cope with inflation.
I allocate some amount of money for unexpected moments, but not that too much, i prefer to invest a part of my income in a good business that can make me some income each month. An emergency fund must not be enough, just a small amount each month can be sufficient to save.
I have never had it before, from the day this question was asked, i started thinking about having it. It has opened my mind and eyes to see the importance of having emergency fund.