Re: Hypothetically: Debt or Emergency Fund?
Definitely given the constraints that you don't have a CC, don't have any assets to tap, etc, the 20k emergency fund is the way to go. In real life, most people have some kind of access to an emergency loan if needed.
What I usually advocate is for people to establish a small emergency fund, then work on paying down 'bad' debt (meaning, the really bad debt), then build up their emergency fund more, and finally pay off 'good' debt. Obviously I use that term a little lightly. But being able to borrow 20k at 5% is pretty hot, and as you move forward in your financial life you may find yourself wishing you could get that loan back...
Also realized from this thread that I should have a stash of cash at home. Wonder how much would be good?
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