Emergencies and Emergency Funds
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Emergencies and Emergency Funds
| Wed, 10-28-2009 - 7:46am |
Seems like a lot of people on the board are having dental emergencies!
| Wed, 10-28-2009 - 7:46am |
Seems like a lot of people on the board are having dental emergencies!
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Sinking funds is for those things that come up each year that you know will "sink" or "shrink" your savings.
In my case it covers things such as estimated taxes, car insurance, car registration, car inspections, and vet bills and estimated co-payments for regular doctor visits, dental visits, medications and my son's specialists and parking fees when he goes in for laser therapy.
stacy
~Jackie, BookCrossing Member & Warming Families Volunteer
<I had my e-fund building until house plumbing emergercy ATE it -- so starting over. Can you give me advice on how you built yours so well?
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I know very well how that goes. It doesn't take much to dig into that emergency fund.
As for how to build the e-fund well. I followed Dave Ramsey's Baby steps.
1. Build baby e-fund of $1000
2. Pay off all debt (not including mortgage) using a debt snowball
3. Finish e-fund. 3-6 months worth of living expenses
4. Bring retirement investments up to 15% of your income
5. Save for your kid's college
6. Pay off mortgage
Right now we are focused on getting ourselves in a position where we can start baby step 6 next year.
As for baby step 5. We started all this too late, so we are planning on paying for ds's books and travel. We will also continue to cover his car insurance and cell phone while he's a full time student. The insurance is already a part of our sinking funds and the cell is part of our family plan. The books and travel we will be setting money aside for each year, starting sometime next year. Our son is currently a HS junior.
Stacy
R
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