The Importance of an Emergency Fund
I’ve mentioned before you should have an emergency fund - and I hit one of those snags that shows how important it is to have one. We have two cars (both Honda Civics) which both needed major repairs - timing belts, water pumps, and exhaust work. My car - the old beater - was less than $400 (which also goes to show - find a trustworthy mechanic! I was quoted $600 at the first place I went to!)
The nicer, newer car? Nearly $1000. Needs a new exhaust manifold. That, needless to say, was a shocker. With the new baby, I really hate having only one car available at a time, and “exhaust leaks in the front of the car” cause me some concern when I’ve got a growing boy in the back seat, so of course I had him fix it (and I use this mechanic repeatedly because he’s always straight, never lies, and has been a friend of my wife’s family for years).
Luckily, we’ve got nearly $5000 set aside for emergencies, so this will greatly offset any ding that it would’ve otherwise caused. See how important an emergency fund can be when you’re prepared? $1400 is more than my mortgage payment - which means if I wasn’t prepared, this would go onto a credit card, which I couldn’t pay off immediately, giving me interest charges for the next few months (more than likely!)
Because I was prepared - I can pay off these charges right away, without worry! No worrying about not meeting any bills, no worries about “how can I handle this” - a true moment of Financial Zen. My wife was taken back by my tone when I initially told her - and through no fault but my own she was concerned. We try and talk weekly about our finances, but with the baby being born it’s sidetracked us both - but because we are prepared, it’s a non-issue.
Whew!
posted in auto, budget, emergency fund, financial planning, money management, zen | 0 Comments
