Importance of an Emergency Fund

[ActYourWage]

Real life example - My clutch went out on my ole Chevy S10 this morning before work at a stop light. Thankfully, I didn't get hit. I had to get it towed and repaired. The total cost - a nice $800 plus taxes.

However, the point of the story is thankfully I had an EF. For anyone trying to decide when is the right time to start and build an EF up, now is the time.

[ukgaz]

I recently started my EF as well ( Nov 09) split between two accounts and was trying to decide what I would consider a emergency.

After much thinking I went with
a) If I loose my job/income
b) For health reasons

I considered car issues in this but decided to create a separate car fund. My initial payments to this are low as I still have a car loan but it will help with repairs. When the loan is paid some of that money can then go to my car fund for further repairs/replacement

[Fizgig]

Yep, the EF has saved my bacon time and time again. I'm shocked at how many of my (high earning) friends have essentially no cash in the bank.

[ActYourWage]

I recently started my EF as well ( Nov 09) split between two accounts and was trying to decide what I would consider a emergency.

After much thinking I went with
a) If I loose my job/income
b) For health reasons

I considered car issues in this but decided to create a separate car fund. My initial payments to this are low as I still have a car loan but it will help with repairs. When the loan is paid some of that money can then go to my car fund for further repairs/replacement

I actually have a vehicle fund within my EF. Kind of like a EF within an EF. I am a structured person and that is how I like to keep things.