what your bulletproof emergency fund...

Budget Girl Exactly! same here! And I like the idea of keeping it separate (a Separate bank, not just separate account sounds like a great idea!)

Budget Girl Keep it up hun

I agree with you Budget Girl! Just completed BS2 last week (man it feels so awesome!) and next month, I immediately plan to begin BS3 with the exact same intensity. Aiming to get this completed within several months-1year! Good luck to you!

same here i'm ready to get my 3-6 months savings!

Lisa Pyle same here. 3 months done. Three to go.

That's exactly what I do. I try to fund my sinking funds monthly because most cases repairs are a bit costly.

That's a great idea, those sinking funds help protect the emergency fund. It's another layer of protection.

thejenternet Yup we do the same thing. sinking funds changed the game!

Great idea! We need to do this. Recently had "new"(er) trans installed and radiator replaced. Wouldn't have made a dent to refill in the emergency fund if we had had a separate repair fund in place.

What is a "sinking fund," please? This term is unfamiliar to me. Thank you.

Sunny Jang I know! She must lift a lot of weights!

mikeyvester You need 3-6 months of living expenses.

TheMysticsoul77 My first goal to reach for my emergency fund, the exact same as you.But once I reach it, I’m gonna see if I can make it my 2nd goal to another 12 months or so or more if possible!

🤦🏻‍♂️

How long does a typical claim for social welfare take to process, before you receive it? You have to apply for it, it has to be processed, usually there will be some kind of backlog, then they communicate a decision to you, if successful then you will receive the money. If you leave some vital detail out, or they need to verify something with you etc the process will take longer. Therefore you need an emergency fund that 'bridges the gap' between the emergency and when you will eventually receive the social welfare. You should really be behaving as if there is no social welfare and save accordingly. Obviously claim for what you are entitled to and have paid taxes for, but don't rely on it coming to your aid immediately. Then, if and when you do receive social welfare it's a bonus!

Money market account has higher interest rate to boost your savings income but not by much, double check with your bank. Some mm accounts have penalties for withdrawing your money within a certain time frame. You need your emergency fund accessible with no penalties. Just practice some self control and if you feel the need for seperate savings, do it. A bank that is a federal credit union is typically better than a big corporate bank as well, better return on your savings and better customer service.

www.investopedia.com/terms/m/moneymarketaccount.asp

Great question, I was thinking the same thing and where does a "regular savings" fall into the baby steps?

Where are you on the baby steps?

Sly Foxx BS3

Pretty much what Mariana said. Once you hit steps 4,5, and 6 you can back off on your intensity a bit. Invest 15% for retirement, save/invest for kids education and pay off you house as quick as you can. I'm done the baby steps and I keep about 15-20 in savings for what I call my once a year big expense... like a few grand for a vacation or like this year, re-doing a bathroom that was out of date 20 years ago.

stephkan20 I bank with a credit union and am on Baby Step 3. In my regular regular, everyday account the checking account pays my bills and I have my $1000 emergency fund in that savings account for easy access should there be an emergency. For my 3-6 months I still have it at the same credit union but in a completely separate account that way I can transfer money from my regular account to my 3-6 months account when we budget. So if we budget $250 dollars to go to our 3-6 months, I just hop online and transfer it directly to my other account. I just don't carry the debit card that is attached to it and pretend it's not there.

what if its only a small portion?

You stop whatever you’re doing to refill your emergency fund.

I don't know what Rachel or Dave would say but if you are on BS4 then it's probably not wise to stop investing just try to replenish as fast as you can. That being said if you are on BS5 or BS6 then I would recommend stop saving to kids school fund or paying extra to the mortgage and just focus on building up your emergency fund again. Then within hopefully a month or 2 you will be fully funded again and just go back to the baby step you were on. But it's whatever you feel comfortable with.

If you don't have a 3-6 month emergency fund, then you are, according to Dave and Rachel, NOT in BS4,5 or 6. You are in BS3. You should not be contributing to retirement or other investments, nor have any debt except your house payment.

JD Williams, I'm hoping I understand your question correctly. If you already have $1000 saved up for your Baby Step 1 and have all your debts paid off (excluding a mortgage) in Baby Step 2 then you're ready for Baby Step 3 which is 3-6 months of expenses, not income. In theory, should an emergency arise like job loss you'd have what you need to get by for 3-6 months depending on how much you've built up. So no cable, Netflix, Hulu,, eating out, movies, etc. Only the necessities. I hope that clarifies it for you.

partychefamanda Hey, thanks. Yes, that's basically what I'm looking for. Much appreciated.

Josh Wolfe you make less than $30k???? 😩😩😩😩

Start with $500 then save $1,000 THEN focus of 3-6 months of savings :)

Yep, I'm afraid so.

Dave says if you make less than 20,000 then your emergency fund should be $500

Jose J-H My husband and I both make under $30k and that's two incomes!

gotdairy - After your emergency, u go back to saving the emergency fund AGAIN 😀

Samantha Anne I'm pretty sure Dave and Rachel say to stop whatever baby step you are on and just save, save, save! once the baby is here and you are both healthy and home. then you can go back to normal. I think Rachel has a video on it.

If you think having a kid will increase the likelihood for emergencies, sure. Most people would think that. Your monthly expenses will certainly be higher, so it follows that 3-6 months of expenses with a baby would be higher than without.

YNAB is good also and you can apply all of Dave's principals such as zero sum budgeting

Acinomnieves3 It's essential expenses. Not income.

Expenses = money needed to live, not income

Booney Inc that’s his daughter

Maja Maja when you are on BS3 you use the BS1 fund as the start. Just add to it. :)

thejenternet thank you very much! 😊

Trek Compsport You are living above your means if you buy a car on payments. You also should not deplete emergency funds for a new car. They are for emergencies. The car you can afford to drive is the one you save and pay cash for.

Don’t deplete your emergency fund for a new car. A new car isn’t an emergency. SAVE for a new car IN CASH. Never finance a new car. Or ANY car. Emergency fund is for an EMERGENCY. don’t buy anything that you can’t pay cash for. And don’t use emergency money for non emergencies.

Revived No he'd not he's your age. Your jealousy is showing.

Sorry he's HER age.