Ask Away...: The Importance of Having an Emergency Fund

Monday, March 2, 2015

The Importance of Having an Emergency Fund



If you are familiar with Dave Ramsey and his baby steps, you know that the first baby step is to have $1,000 in an emergency fund before you do ANYTHING else.   Some people question why that's even necessary when they are trying to get out of debt.  





At first, I admit that I wasn't keen on having to gather up $1,000 before I could start throwing any extra money at my debt but man oh man that has ended up saving my behind.



Because once you have $1,000 set aside for an emergency only, you don't really have to worry about having to use your credit card if the situation comes up.   If you get a flat tire, instead of charging it, you tap into that emergency fund. 



I just had almost a grand in ER bills for Rocky and guess what saved my ass. You guessed it, my emergency fund.



And then all you have to do is replenish your fund.  I've had to sell a few things on ebay to replenish it.  This year my tax return conveniently came into my account the day after I cleared my emergency fund.   Perfect timing!!! 

The major benefit of having an emergency fund is the peace of mind you get.   In all of my emotions with the whole Rocky ordeal, not once did I have that terrifying "I'm Broke" thought go through my head.   I knew my tax return was one day away, so I knew I'd have my fund replenished but I also felt so good that I didn't have to ruin all of my debt snowball progress so far by using my credit cards.

Did you know that I offer a budget spreadsheet, debt tracker, and I have a financial book available for purchase? 




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PURCHASE Budget Spreadsheet


PURCHASE Debt Tracker

Do you have an emergency fund? Has it saved you before?  





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2 comments:

  1. My emergency fund has saved me more times than I care to count! It is definitely nice to know it is there when unexpected things happen. AMEN for the emergency fund!

    ReplyDelete
    Replies
    1. I know, its such a good feeling to know it's there isn't it?

      Delete

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