With the impending “storm of a lifetime” headed for the East coast, many are wondering if it is time to hit up the emergency fund. Suddenly, we are forced to purchase extra supplies to handle being without power for several days. The storm itself may be an emergency situation, but this does not mean the supplies come out of the emergency fund. Ideally, you should be hitting up your regular short-term savings or your weekly spending allowance for supplies.
If you can’t fit the supplies in your budget, my opinion is hit up the emergency fund. I would rather my fund run low than not be prepared for a major storm. However, for the future, estimate what extra supplies cost for a week without power and add that amount to your emergency fund.
What constitutes an emergency?
-Unexpected weather that can cause major damage and/or long periods without power
-Medical or dental emergency
-Auto repairs that are not in your regular budget (think major repairs such as a transmission replacement)
-Household emergency such as loss of heat or air conditioning (if it is SUPER hot)
-Emergency travel (a family member’s major illness or death)
Most car, dental, and medical repairs should be budgeted for and anticipated. We all know at some point our car will need maintenance, a kid will need a cavity filled, or we need to head to the doctor’s office because we have the flu. However, if a tooth falls out and has to be saved immediately, your appendix bursts, or your transmission has issues, it is time to hit up the emergency fund.
[...] really want to get my credit card paid off. However, I am not willing to empty my entire emergency fund to do it. I have two processes I am considering to paying this off quickly. One: Keep paying my [...]