Emergency Fund Savings Update

06 Mar
by Jenny, posted in Money Honey, Saving More   |  13 Comments

Those of you that have been following this blog for awhile know that near the start of a new month, I like to post an update of any financial goals I’m working towards. Currently, Kirk and I are working on funding an emergency fund totaling six months of our living expenses.

As you can see from the below chart, we’ve made steady progress on this goal over the past seven months.

It’s hard to believe that we’ve come this far over the course of one year. At the beginning of February, 2011 we began tackling nearly $26,000 in consumer debt. At the time, we had about $11,000 in emergency savings. We decided to use over half the balance of our emergency fund savings to get a jump start on the debt repayment plan.

We were so focused on getting the debt paid off quickly that we exceeded our planned payoff date by three months! Unfortunately, I can’t say we’ve maintained the same intensity while building our emergency fund.

Don’t get me wrong, we’ve still been diligent about saving money, but we didn’t necessarily go above and beyond like we did while paying off the debt. For example, we used our December e-fund deposit to plan a trip to Captiva Island, FL.

I was distraught about the decision at the time, but in retrospect I’m so glad we planned the trip. The trip is coming up in a hurry and the kids are so excited. And there have been some impending changes in my world over the past month. Given the uncertainties these changes will bring, I would have never planned the trip had I waited.

But, I digress…

If everything goes as planned, we are less than one month away from meeting our emergency fund savings goal of $20,000.

The primary purpose of this savings is to allow our family to live and pay all necessary expenses for up to six months in the event that both Kirk and I were not earning any income. We would have to suspend contributions to our Roth IRA, vacation savings and 529 account’s for the kids, but we would be able to cover our mortgage, utilities, car insurance, groceries, etc.

The savings could also be used to fund other unforeseen emergencies like house or car repairs, medical bills and other unplanned expenses.

Once we have our emergency fund fully funded, we plan to save up enough money for Kirk to buy a used car (his is aging quickly).

We’ll just have to see if life has the same plan in mind as we do!

What financial goals are you working on lately? How are they coming along?

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Related posts:

  1. Emergency Fund Savings Update – September
  2. Emergency Fund Update & Other Money News
  3. Emergency Fund Savings – October (And Other Ramblings)
  4. Emergency Fund Progress, Month 1
  5. Emergency Funds are Sexy
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13 Responses to Emergency Fund Savings Update

  1. So exciting to be meeting your goal! We have about a year’s worth of bills saved up at the moment. However, we are planning on spending a bit on home repairs (flooring, landscaping, etc.). There’s also the possibility that we’ll need a second car in the next 5 or so months. At least we know that we can afford all of these AND have enough leftover should something go wrong!

    On a side note, do you ever feel worried about posting the amounts in your bank account? I always avoid talking too much about how much we have in case someone can track the account down. Thoughts?

    • Hey Megyn,

      That has to feel so great having a year’s worth of expenses saved up! Even though you’ll be using some it, like you said, at least you know you can afford it.

      That’s a good question about listing the total amount of our e-fund. We have the money spread across a few accounts at different institutions, so that would make it a little tricker to track. And I guess I feel the need for transparency with our finances when I discuss person finance here, ya know? :)

  2. Wow Jenny, that’s a lot of saving and debt paying in just a little over a year! Congrats!

    I’ve always been a saver (or a tightwad as some would say), but I’m working on finetuning my saving habits and kicking things up a notch or too. I’m working through Your Money or Your Life to help facilitate this, and am launching an online YMOYL book club. I’m hoping some others join in so we can learn and grow together.

  3. WTG Jenny! Our emergency fund brings us peace of mind – something up until 3-4 years ago, I’d never had with my finances. good luck hitting your goal this month :)

  4. Jan

    DH & I paid off our mortgage, my student loan, my car loan & all our credit card balances over the past 3 years, but finished in 12/11. Now our Emergency Savings just crept over the $20k mark & we are saving for our next house & plan to pay cash. What a fantastic feeling & congrats to you guys!

  5. Homer L.

    Congrats! You’ve that much for your emergency fund. I’m also saving for my health insurance. I hope I could save enough money at the end of this year. That’s my goal. How old is Kirk now? Thanks for sharing your saving endeavor. It’s kind of contagious.

    -Homer

  6. Anita Malhotra

    It is great that you managed to save such a great amount of money.
    Keep up the good work.

    Best wishes.

    -Anita

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