My Emergency Fund Saved Me From Myself

September 3, 2012

 

I am going to be honest with you- I’m a girl who loves to be consumer debt free.  I’m all about having a Roth IRA and putting money away for a rainy day, setting up spending parameters (even if a budget isn’t plausible) and being a free bird when it comes to your money… but sometimes even I slip up, BAD.

The last two months have been dedicated to sorting out my post-graduate school life and I am not sure if I put my head in the sand or just got totally distracted, but my credit card bill arrived and it was a total wake up call.   While all of my expenses and reservations for 2013 travel seemed to come at once, I should have planned better, but didn’t.  Couple that with a cross-country move that involved hotel stays, a rental car, shipping of my junk & pug care, I was in over my head.

 

Before even the $800 rental car was added to my credit card bill, I was out of money. CRAP.

I wanted to hit myself, but being without health insurance, that would only worsen the situation since doctors (especially when one has no coverage) cost money.  I was about $1,500 in the hole- I kid you not.  Granted, I’d knocked off $500 off my student loans and booked 2 amazing half marathons and purchased a few necessary personal items- but seriously, when you don’t have the money, $1500 over budget is disgustingly huge. Couple that with the fact that my income was non-existent since I wasn’t working before the transition from Chicago to California, and we had a major, major problem.  The job hunt had taken longer than expected, and I felt zapped of energy applying for jobs and looking up info to make the trip.  I was in a sad state.

 

Thank God, three years ago I had the sense to set up an emergency fund to save me from myself.

I have two funds actually-  one is an emergency fund, the other is a travel fund that I set up on a whim.  Each week, I put away about $40.  My emergency fund was set up about three or four years ago and put in an entirely different bank from the one I use for checking and savings- out of sight, out of mind.

The second account was set up about 6 months ago for a “vacation” that I had stipulated yet.  Turns out, I’ll be needing that money for The Financial Blogger Conference and the Tinkerbell Half Marathon in January and I am so happy I put the cash aside already!  In that account over six months, I’ve saved about $650 by putting away about $30 a week.  At first, $30 seems like a lot, and trust me, as a broke former grad student, it can be- but when you learn to live with the discomfort (just like you do with half marathon training) and push your comfort zone, the rewards are bountiful. It adds up!

 

Needless to say- I couldn’t believe that I had underestimated the cost of post-graduation life with loans & job hunting, but I am so glad that I was ready with an emergency fund when it became necessary to use.

I withdrew the money from my emergency fund- completely clearing out my savings from that account (sucky) but I was able to pay off my credit cards and completely fund my move from Chicago to California (not-so-sucky) and live debt free.  Now that my head is back in the game, I hope I’ll keep better track of both my spending and work on some side hustles.  Truly, you never know what life is going to have you- it’s not always a catastrophe like a leaky roof or a broken bone that costs money, there’s an untold cost to being human and not paying attention!

 

So, have you been in a financial pinch? How did you deal with it?

Did you have an emergency fund or did you come up with a side hustle to earn some cash?

 

 

21 comments so far.

21 responses to “My Emergency Fund Saved Me From Myself”

  1. For me a little of both-an emergency fund and a side hustle. July and Aug were dead as far as freelance work. July I had covered because of a spillover account I set up where I put extra funds from previous months of freelance work. But I hadn’t expected Aug to be so dead, so I got two side jobs, and so far have had to take out 700 to cover rent and health insurance. I hope 700 is all I’ll have to take out, and I can repay that back VERY soon. I’m sad it had to be depleted AND I wasn’t able to contribute anything to savings this month, but glad I had it.

    • Shannyn says:

      I am going to get my act together this month with my side hustle so I can build my emergency fund back up! My goal is to earn an extra $350 a month to put away in savings.

  2. Rebecca says:

    Great planning ahead! This is the exact reason why we’re building up our emergency fund – juuust in case something happens where we need it.

    • Shannyn says:

      Ya, it can be anything- car repairs, getting laid off or needing to take an impromptu trip to visit family when you need to go. You never know and it’s always good to be prepared.

  3. Amelia says:

    I’ve been attempting to get my bf to start an emergency fund especially since we always seem to have little emergencies or car maintenance we don’t expect to happen.

    • Shannyn says:

      Totally, I’d tell him to just bite the bullet- set one up and set up automatic contributions of anything from $10-40 a week and then forget about it entirely. In even just 4 months you’ll have a good fund ready!

  4. Bridget says:

    My emergency fund saves my butt at least 3x per year. I’d be totally screwed without it.

    • Shannyn says:

      Haha, I’m glad I’m not the only one who sees the value of it! Life can be crazy and I know I’m not psychic so I always want to have at least a $500 cushion for unanticipated blunders, problems or life events I need to be ready for!

  5. Having a little money stashed has bailed me out more than once! And if you squirrel it away in little pieces, you barely even notice it.

    As for side hustles, yep, I’ve used those too, but they don’t often raise enough right away to cover the shortfall.

    Our savings account is currently lower than I like, so I’m working to build it back up to at least $1,000 right now.

    • Shannyn says:

      Ya, my first goal will be to hit $500, then get it back up to about $1,000 and about $500 more in my savings account for travel since I’m doing so many races in 2013, I want to have a good cushion to have it all paid for.

  6. So happy to hear that despite everything, you were able to cover it! That is why everyone should have an emergency fund 🙂

    Mine was always helpful with car troubles. Need a new tire? Efund. Roommate totals it in my driveway and I have to get a rental for a few days? Efund. Certainly less stressful than putting it on a credit card and hoping the money comes in before the bill is due!

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  8. crystal says:

    found you from budget and the beach link love. good post. emergency funds are the key to staying out of debt. good luck with your side hustle. i really want to work on that too.

  9. Wow – kudos to you for having emergency funds set aside! I try to save as much as possible, but as a small business owner it seems like most of my income goes back into my business! I’ve set aside a college savings program for my son though, so he’ll be set!

    Keep up the good work!

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