Spinoff: Emergency Fund/Financial Plan

posted 3 years ago in Money
Post # 3
957 posts
Busy bee

I have money in a tax free savings account. Ideally, DH and I want to have a joint high rate savings account for emergencies so we don’t have to touch our TFSAs. But if I lost my job right this second, I have savings to keep me going for awhile. 

Post # 4
1125 posts
Bumble bee
  • Wedding: January 2010

Our house is paid in full in a suburb near our workplaces. We both would love to live in the country, but keep this place so we don’t have to deal with traffic.

If we were to lose an income, we’d be well able to live on the remaining one, but have decided that we’d sell our home and relocate in the country where houses are cheaper. Then we’d find local, part-time work and as long as we can bring in a certain amount per month, we’ll be happy. It would be such a lifestyle change, and sometimes I almost wish it happens (which isn’t too farfetched since DH’s company is undergoing a big merger and we wouldn’t be surprised if the local office is closed in the next few years which would mean either relocate in an area we’re not interested in or take a severance package).

I know we’re very fortunate to be able to not fret about money. We’ve actually worked very hard to get there and we’re very proud of it. The only debt we have right now is one of our cars and we’re working towards eliminating that as well. Then we’ll be a cash-only household. The feeling is amazing.


Post # 6
7281 posts
Busy Beekeeper
  • Wedding: October 2011 - Bed & Breakfast

We can pay all of the bills and live just a little on one income.

If we lost both incomes, we would tap our cash emergency fund first, which would carry us, comfortably, for 8-9 months or tightly for 10-11 months, and then we would sell our house and one vehicle (should bring in about $170k of profit), add that cash to our current investments, and live cheaply enough to exist on the investment income with minimal draw down of the actual investment balance. That would mean taking DS out of our amazing school system to live somewhere much less expensive, which would be a huge bummer, but we would stay afloat. 

I think it’s really important for people to have a plan. Someone I work with was recently in a skiing accident. She spent a month in the ICU in a coma and will spend many months in a rehab facility. She lost her substantial income for an indefinite period of time once she exhausts her paid time off and will have plenty of medical bills to deal with. We have good insurance, but even to co-pays and such will be a real b*tch. People think things won’t happen to them… but they will. It’s just a matter of when things will go wrong.

Post # 7
885 posts
Busy bee
  • Wedding: October 2013

If either DH or I lost our job, we could survive on only one income… it would mean cutting to the bare essentials, but it would be doable.  To be honest, even if one of us lost a job, I can’t see it taking longer than a month or so to find a new position, based on the fields we are in.  

We have enough in our TFSAs to get us by for at least 6 months with no other income source (ie., if we were both out of work) and worst case we have stuff we could sell.

Post # 8
4402 posts
Honey bee
  • Wedding: September 2010

I have about 6 – 8 months of living expenses in a liquid savings account — it’s my money market account at my bank. This account earns almost no interest right now, so I like to keep the balance relatively low. Any extra money I have beyond the 6 – 8 months liquid emergency fund I put in a brokerage account. If things got desperate, we could sell stock from the brokerage account & use some of that money. 

Post # 9
2878 posts
Sugar bee

@AB Bride:  I’m getting prepared for it to happen to me, because I don’t know if I’ll have a job right away when my scholarship ends in August. And since during the summer most people from the HR will be on vacations, it’s not the best time to be job-hunting. 

I’m putting money aside on every paycheck. I also have my TFSA that has a few thousands in it and I can use it if things go bad. However, it’s money I struggled to save for a house. I’d really like not to touch it.

I’m ready to work at McDonald’s while still job hunting, because I can’t see myself living off my small savings for months. But if I’m without a job because I’m injured, I’m screwed, and I can kiss my little savings goodbye.

Post # 10
1154 posts
Bumble bee
  • Wedding: January 2015

We have savings and are currently living WAY below our means, so we should be fine.  It was important to me that we be able to live on savings in case of an emergency as soon as possible, and although we’ve only been living together for about six months (I just finished school last spring and moved to Boston with FI at the end of the summer) we’re set.  

Post # 11
3077 posts
Sugar bee
  • Wedding: February 2015

We’ve got enough to live for a good while. Probably close to a year. If we lost only one income, it’d be even longer. All our money is in savings right now, I’m not a fan of investments but we’re slowly working on opening up IRAs

ETA: We also could cut expenses pretty significantly

Post # 12
1648 posts
Bumble bee
  • Wedding: August 2000

we’ve got alot in savings to live off of for prob at least a year. 

Post # 13
8387 posts
Bumble Beekeeper
  • Wedding: April 2013

We have 7-8 months (or 10-11 months if we cut out “luxuries) of living expenses in an emergency fund just for this purpose.  We only have 1 income anyways, so our monthly expenses are pretty low.

Post # 14
1193 posts
Bumble bee

We can live on one of our incomes alone, so we wouldn’t really have to change anything except maybe cut out extravagances like international blowout vacations, etc.

If we both lost our jobs, we have enough in our savings right now to get us by for about 2-3 months. We both have Roth IRAs and I have a Roth(K) we can pull money from tax free if needed. This would last us for awhile – probably over a year. We pulled money from our savings to pay for the wedding, and we plan to build that back up plus some by the end of 2014.

Also, if either of us gets in an accident/disabled, we both have disability insurance. Our jobs will pay short-term disability at 60%, but we have insurance to cover the other 40% loss of income. Because lets face it, not only are you NOT working, but you certainly will have increased expenses with medical bills, therapies, etc. Its cheap (around $70/month for both of us) and well worth the peace of mind.

Post # 15
5697 posts
Bee Keeper
  • Wedding: August 2012

We have savings, credit cards, if things got really desparate we have 401k’s we could borrow against. We are also lucky enough to have family that would help if we needed it.

Post # 16
170 posts
Blushing bee
  • Wedding: October 2016

We both have about 5 months of expenses in savings, and have (but never build up debt on, we pay them off monthly) credit cards if something gets really short.

And honestly we live in a super cheap apartment and don’t have many expenses. We lived off just my income for a few months when he first moved and it didn’t put us into debt. We could do it again.

I’m also paying off significantly more than I need to be paying on my student loans, so worst come to worst I can dial that back and save a good $250 a month.

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