Emergency Fund

You work the government, directly or indirectly, eventually a shut down will get to ya.  If you are an indirect worker, that money is never coming to you.  If you are a whiny gummint worker you ALWAYS get your back pay from your enforced vacation.  Never not.

You still need to get over that hump.

And if you don't work for the gummint, you can still get laid off or the business you work for can go belly up.  And bingo, between jobs.

Been there, myself.  I was out for 4 and half months last time.

You need to get over that hump.

You need an E-Fund.

"But I don't get the big bucks like you do T-Bolt!"

My current decent salary is a new event.  It just makes building that Emergency Fund a bit easier.  But I wasn't paid good back the last time I was out of work.  Well, just before I was out of work.  I still had an Emergency Fund.  You CAN do it.

But I have always been a halfway decent saver.  I didn't contribute the max into my 401k back then.  But I did contribute enough that it hurt to.  I always figured Social Security shouldn't be counted on.

Now there are lots of rules of thumb for an E-Fund.  Save at least 1 month of expenses... 3 months... 6 months... whatever!  Of liquid money.  Money you can withdraw from a savings account or mattress and spend tomorrow without a penalty.    Save something.  Something.

Back when I was out of work I got enough from unemployment to cover the car payment and the mortgage.  It made me say "never again" to a car payment.  Or a new car.  And that was the source of further E-Fund building.  I diverted part of my salary to the credit using I had where I financed my car.  Plus a little bit.  The little bit built.  It was something like $350 a month?  Anyway, I paid the car off, but never stopped the diversion, and that money built.  I had a bank where most of my money went to pay bills.  Usually online.  That $350 just went to the other institution and never left.  I put it on the Saving side instead of the no interest checking side. And it sits there.  Building.  For emergencies.  Like a roof.  Or the next car to pay without a car loan.  That was it's primary purpose initially.  To have more than enough in there to buy the NEXT car when the current one needs replacing.  I always have a 'car payment' but I pay it to myself.  My savings account.  Instead of my banker.

It behooves me to get every last drop out of a vehicle before getting another.  I use up a truck, then throw it away.  If I get $500 on a trade in I am ecstatic.

The E-Fund for me, is for that roof every 20-25 years.  A new furnace.  A new air conditioner.  Unemployment.  A new vehicle.  Big stuff.  Stuff I don't want to have to finance.  I used it to put in a new driveway 5 years back.