let's wrinkle this sheet up a little more by adding that sometimes whether a "situation" becomes an "emergency" is entirely dependent on how beholden you are to other entities.

meaning since I don't owe anyone a cent, even a big unforeseen whack upside the head does only limited damage because there's nobody for me to fall behind with. my only concerns are a place to live and keeping the utilities going (obviously in a Katrina like situation, even that's not an issue as you have to find a new place with new utilities).

granted, these are important concerns to be sure but they're equal across the board for everyone. I wouldn't have the added weight of trying to keep up with a car payment, credit cards, loans, etc., something that is very important to me.

that makes me feel better establishing a small emergency fund and then wiping out the debt. for me it's not just the interest and numbers (although I am certainly an interest and numbers type of guy!) no, this is one place where the feeling of security overrides what may make better sense. in my case, the security comes with the freedom from debt/obligation.

I do like the idea of enough cash on hand to get you out of the situation in an example like Katrina, once you make it to a stable area, the electronic financial world will be available to you again.

let's hope God and fate spare all of us from having to ever use that cash.