Emergency Fund?

**Ashley01** · 02-18-2011, 12:57 PM

What should be included in my 3-6 month EF? What does everyone include in theirs, I want to do up a bare bones budget and then redo what my EF should be.

**Greebo** · 02-18-2011, 02:49 PM

Bare bones balls to the wall expenses only.

In an emergency, it's survival mode only. No cable save internet, no frills, no frou frou, no flash - just the four walls.

**jas** · 02-18-2011, 03:08 PM

Originally Posted by Greebo

Bare bones balls to the wall expenses only.

In an emergency, it's survival mode only. No cable save internet, no frills, no frou frou, no flash - just the four walls.

That's what I was thinking. It would be just what you need to maintain life. No frills.

**OOwl** · 02-18-2011, 03:24 PM

Since I'm at this stage, it is my nature (pessimist) to think this fund needs to be bigger than it really does. So, to be more detailed on this. It would be 6 months of housing (in my case, since house is paid for, taxes/insurance), basic food (including pets), utilities (basic Internet), gas/oil changes/basic mx for vehicles, insurance premiums (car, life, long-term care), and basic clothing (although I think most of us have enough existing clothing to last YEARS if we were really in "emergency" mode). So, I should add up those monthly bare-bones expenses, multiply by six and I have my emergency fund? Do you take any expected unemployment or disability payments into consideration or not?
Thank you for your thoughts on this. . .

**kitkat0649** · 02-18-2011, 03:59 PM

Ours is our entire monthly budget less monthly savings deposits.

**Contrary Housewife** · 02-18-2011, 05:43 PM

Ours covers:

all utilities
gas (car)
reduced food budget (I use the stockpile heavily)
medicine/prescriptions

We don't have a rent or mortgage payment but yours should include that too.

**Sassyclass** · 02-18-2011, 07:27 PM

I just started ours and don't have a real target yet until I get back to work, and see how much we will have coming in monthly after I have no support coming out for my son, and DH gets a raise in April. Then I will be shooting for 3 months of all bills. If I can get more than that saved fine. If I get laid off again this winter we will be ahead of the game and my stockpile will be there.

Cat

**xtena** · 02-18-2011, 08:01 PM

Since COBRA is prohibitively expensive I would add in that or private temporary health insurance costs as well.

**MomToTwoBoys** · 02-18-2011, 10:31 PM

You're going to need money for your extreme basics. This means rent/mortgage, insurance (if you own your own home), food, utilities (this is power, water, sewer, trash, gas) and medication. Cable, phone, automobile, etc are considered to be luxuries and as such, they should not be included. If you absolutely need a phone to call someone, you can purchase a pre-paid cellular phone with a 911 option on it.

**Ashley01** · 02-19-2011, 08:40 AM

Thanks everyone! I went over my number and did an EXTREME barebones budget and I've already got enough saved to cover 3 months of that. I did up two budgets an "emergency" one where I'm allowing a little more for groceries, keeping my Internet, and have a small misc fund. Then the barebones only had absolute basics.

One more question, I have 4 savings accounts. 1 for banking out of, 1 for my daughter, 1 for my small ef, and one for other things I'm saving for (hair cut, glasses, Christmas etc) then my bigger ef is In a tfsa. Anyways my question is would I count all that money towards my end totals? And I'm doing the envelope system so would I could that month. Or just solely what's in my savings?

**Imarachne** · 02-19-2011, 08:48 AM

I think , if you can, 6 months should be the norm.

**OOwl** · 02-19-2011, 11:17 AM

I had forgotten about budgeting for 3-6 months of health insurance premiums! Yikes! However, you're right, that REALLY would need to be in there. Cobra, if nothing else. Right now, Cobra would be about $700 a month for my husband and me if something were to happen to his job (my company gave up offering health insurance two years ago, so I'm soley covered under his policy). If it went beyond that, private health insurance (high deductible) is EXTREMELY high, somewhere around $1500 a month for a couple over 40. I guess my need to have a bigger emergency fund is serving me well in this case. Glad for this thread. It brought up a category I hadn't even considered. Oh, and I do not think "automative" is a "luxury." Where I live, there's no public transportation. No car, no way to go collect food or look for another job, not to mention no way to get to that job once it was secured. Yes, in MY emergency fund, it will have funds set aside for car/car insurance/basic maintenance (car is paid for). Glad we're discussing it BEFORE it is needed. Time on my side to SAVE, SAVE, SAVE!

**khaski** · 02-21-2011, 10:37 AM

My thought is 6+ months of 'usual' expenses including cable, phone etc, imo 3-6 months of bare bones savings is not enough to make me feel secure, but to each their own. I would seriously consider if only 3 months absolute basic savings are enough for anyone. I would argue no, not enough of a safety net!

**OOwl** · 02-21-2011, 10:46 AM

Since, theoretically, one is building this fund prior to it being an emergency (and this is the way I'm choosing to interpret this), I'm assuming it can include everything basic that wouldn't cause undue hardship while you look for another job for 6 to 8 months (because it really does sometimes take longer than 3 months now to find a job if you're laid off). My fully funded emergency fund, therefore, will contain not only the elements required to maintain life, but expenses such as health/life/long-term care insurance premiums, auto insurance/maintenance/fuel, taxes and insurance on my house (because just because it's paid for does NOT mean it can't be in danger if I neglect to pay the taxes and insurance), and, in my case, basic pet care needs (different people have different thoughts on this, but my animals are revered and I will be including their care in my own emergency fund). It may take me a bit longer to complete this fund than a bare-bones EF, but I think, personally, I'll sleep better having done so. Guess that's the "personal" in personal finance that DR speaks of. . .

**kitkat0649** · 02-21-2011, 05:55 PM

For those of you who base their EF off a bare bones, cancel the cable, cell phones etc budget, are you not in any sort of contract for these plans? If you are in a contract, would you include the cancellation fees for these services in your EF? I remember several years back when I canceled my individual cell plan through Verizon to be added to a family plan through my husbands(ATT) I had to pay a $175 cancellation fee.