debit and savings

[working on it]

I'm currently in the process of snowballing a little debit we have. We have savings in place, but don't want to wipe it out unless I really have to. (small cc balance 0% int & small personal loan) I keep hearing about having an emergency fund setup. Is this a cushion for unexpected expenses or something setup in case of a layoff to live off of? What are the suggested savings you have? For example I was thinking I should have our medical deductable set aside. What about a car fund or car repairs? Or does everyone just keep putting $ into one savings account that isn't divided for specific use?

[justpeachy92]

The purpose of the baby emergency fund ($1000 is the suggested amount) is so while you are paying off your debt and the car breaks down, you can hopefully pay cash to have it fixed instead of taking on more debt. When your debt is paid off, you throw your snowball into the emergency fund to save 3-6 months of living expenses. The idea for the bigger EF is to be covered incase of a job loss.

[Alam]

The premise for the EF comes from Dave Ramsey's Book "Total Money Make-over" He lists steps to gaining financial freedom... The first step is to stop accruing debt, the next is to start your $1,000 emergency fund for the reasons that justpeachy92 mentioned