Many people do not have enough money in their bank accounts to pay for a $1,000 car repair bill. I have worked with and talked with so many people that had less than $100 in their checking and savings account. Many had no retirement savings either. I have heard that one out of four people have no emergency savings fund.
We believe in having an Emergency fund for our family. We teach our boys to have at least six months of their total expenses in a savings account. We like to use a Brokerage Account for our Emergency Funds and we invest it in Stocks, Mutual Funds and EFTs. We know if we have to liquidate some funds to pay off an unexpected bill, we could with in about seven days at the most.
Of course, no place is safe and no investment is safe. Any Investment can go down at any time. Some Financial Coaches or Advisors may feel that you should keep the money in a well know Bank and not in stocks. That is fine for them, but for us we believe in the Market. You need to make your own decision with what amount of risk you can accept. That is where a Financial Planner can help you out with options and making your choice if needed.
Remember this show is for entertainment only and you should seek advice from your Financial team if you have any questions on Investing. See my Disclaimer on MillsWay.com. I want to help you prepare for an unexpected bill so you don’t go into debt paying on a bill. I want everyone to live Debt Free and reach their Financial Freedom goals.
So, if our monthly expenses average about $3,600 per month then we need to have saved $21,600 in our Emergency Fund.
If we know we have some big expenses coming up in the next year or two we will build up our Emergency Fund account to cover those expenses also. For example, if we need to buy a used car next year and we feel it will cost us around $10,000. Then we will need to build up our Emergency Fund account to $31,600.
Here are some examples of Emergency Expenses that can come up and if you don’t have the money saved for them then you could go into Debt. Covered in the Podcast.
Let me know your thoughts about this blog and let me know of others you would like me to do in the future. I feel we can all learn from each other. That is why I am in the helping people retire early, enjoy life more and be more successful. Also, please see my Disclaimer page.
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