When my dad unexpectedly passed away in January 2022, I had to dip into my EF. I was shocked at how much a funeral cost ($10K)! BUT I've been been listening to Dave Ramsey since 2017 so I was ready for any type of emergency. Every year I would reevaluate how much I needed to save in the EF category to factor in inflation/and higher cost of living in NYC. So when I had to pay for that funeral bill I wasn't stressed, but ready. Since January I've been rebuilding my EF and hoping I can get it back to where it was by the end of the year. I just have to say having an EF gives such piece of mind. I felt blessed and thank god he sent Dave and Rachel my way when I needed them the most in my life in 2017 to help change my ways with money.
My stress level changed SO much when I got my 3 month emergency fund! It actually helped me transition out of my full time job because I knew I had something to fall back if I had to. I haven’t had to go back to a regular job in a year & a half! So thankful my friend got my listening to your dad & that I then found you!
Sure needed my fund this year 2021! Had to have my 26 year old leeking roof replaced on my 100 year old home. And my gas hot water tank replaced. And replaced broken clothes dryer! Also had my 2006 car worked on twice with a new battery too!I am now broke time to start saving up again!!!
Furnace died last week. Ended up replacing it. We also got about $10,000 in medical bills (after insurance) this month due to my wife's pregnancy/birth. Always put a little more in your savings in case of LIFE happening all at once.
Just used part of my emergency fund to fix my car yesterday after my check engine light came on Sunday afternoon. I was SO grateful to have my emergency fund 😁
It is a bit sad that we need to have videos like this to guide us. Our culture promotes spending beyond our means and not waiting until you actually have saved the money for whatever it is you seek. Remember, possessions do not make us rich. Always good to have savings for those 'rainy days '.
My car has had multiple maintenance needs over the last few years. My Emergency Fund and other sinking funds have been a blessing. Paying those back as quickly as I would like has been a challenge.
You are correct, I thought we go for 3 months emergency fund but my wife said 6 months. I am so thankful for her. Here is is my question, is it advisable to put those funds in a high yield account as a opposed to leaving them in the savings account?
shouldn’t say 3 month; 6 month etc should say what amount covers all my deductibles; what’s my worst case 2% on homeowners + car deductible etc if you have this nothing will ever derail you.
So I'm renting in Baltimore and having a hard time saving I tried one side hustle which helped but I made some mistakes and backing out of it. After a nasty divorce, bankruptcy and foreclosure back in 2019 I'll be in the position to buy a house next year. Any thoughts on tiny house living it would be me and my preteen son. And where to do research for one.
You know it's amazing what we found out after our mortgage got paid off that we're still spending almost $600 a month just in property taxes and insurance on the house I mean we were just shocked by that we didn't realize how much money of our mortgage payment went towards that so when we paid off the house we thought we'd have all this extra money and we really found out we didn't I mean we did have extra money but not as much as we thought I think that's something that some people maybe don't realize that in some states like where we are property taxes are outrageous so I still feel like I'm making a mortgage even though my mortgage is paid off 🙄 so the wife and I are considering selling the home and paying cash for a home in a different state where property taxes are less and we're able to save more money because the money we're giving away now is literally that we're giving it away to the tax man.
That’s what I’ve heard The 3 to 6 month emergency fun as for living expenses like things you can’t live without like utilities and transportation rent mortgage insurance etc and you should have separate savings worth 1-4 percent of homes value saved every year for maintenance
Understand and agree 100% about emergency fund. Forgetting about interest, what about inflation? 3 to 6 months of expenses can easily lose buying power: how to avoid or minimize this without constantly funding ?
You don't avoid it. However, a large part of your emergency fund cost won't raise directly with inflation. For example if you have a mortgage a large % is fixed costs (other than the property tax and insurance portion). Every year check your budget and see if your emergeny fund matches your life situation. You may find as you becone a saver / investor your costs actually go down... or maybe you will have a life situation like having kids and 6 months feels better than 3. It will always be in flux but adding another $300 after saving up $10,000 won't be an issue.
Well I figure inflation goes up by like 10 percent, so I would add a 10% increase to what is needed for the 43 to 6 months. If it's 20k for 3-6 months. Then I'd say make sure you have 22k for now
Do you have bank recommendations? I noticed you mentioned an online bank and I've been interested in other banks besides the mainstream (US, Chase, ENT, etc).
Any FDIC insured bank or credit union will work. A small local bank savings account not linked with a debit card or online transfers may actully help seperate a real emergency from just a want. The yearly interest is so low no matter where you put it that doesn't matter in my thinking.
Nope. CNBC did a study last year and 60% of Americans don’t even have $1000 in a savings account. That’s still a significant milestone for most people.
Given that I can get my assets out of my investment account in 2 work days, I have my savings there. That being said I do have extra 3 months of expenses saved in my checking just to be safe but all my savings go to investment. If you are a young couple really no sense of having that money just not doing anything
The sense in having the money not doing anything is so that you don't need to pull out of the market when it's down. Like with the 2008 or 2020 crashes where the market temporaraly was cut in almost half. Suddenly your 10k emergency fund is 5k. Doubling your money with compound interest takes 7ish years so you lost 7 years of progess due to pulling out at the wrong time. This is also why 401k loans are a bad idea. The money is removed from the market where it should be growing. The emergency fund is like no deductable insurance... you are giving up some returns for the security of yourself and invested assets.
u have to live. My kid and I just spent $600 on a 2 night stay at a resort (games, indoor water park). Same place from 2 years ago where I remember everything. I’ll always remember these moments, they r priceless. I looked at my bank statement and I have just enough to pay the mortgage and monthly bills this month. I’ve been throwing 600 a month extra at the mortgage. I won’t this month, but o well. I guess this is the guy thing you’re talking about, lol (which is true). I am in baby step 7, but skipped 3. I always say all you’re money needs to be working (that’s either paying down mortgage or investing). Can easily always figure a way to pay bills/mortgage. I’m happy I’ve made this decision. Although, a emergency fund is a good idea for most people and I hope to work on it this year. Once I get to that goal thought it’s probably going to be spent on a dream ($5000) vacation or invest it.
Are you talking about the baby steps? If so baby step one is to have the 1000 emergency fund as a starter then once you’re done with step two getting rid of all your debt except the mortgage then it’s step three and and you would just build your 1000 emergency fund to 3-6 months for your living expenses
Women are conservative financially? What women are you talking about!? Where are these fiscally conservative women? How do I find them? Only one's I've met are endless money spending machines.
1 If you all haven't seen a documentary called... It's worse than you think.... By revelations of Jesus Christ ministries... I suggest you do... All praise and glory to the most high Jesus Christ
In this economy? It’s not realistic! The essential workers have gone back to “unskilled workers” and therefore no longer “deserve” an even slightly below (inflation equivalent) minimum wage. It’s cute you guys keep the positive motivation up but it’s just not realistic and ignoring that realistic fact is just playing into it.
When my dad unexpectedly passed away in January 2022, I had to dip into my EF. I was shocked at how much a funeral cost ($10K)! BUT I've been been listening to Dave Ramsey since 2017 so I was ready for any type of emergency. Every year I would reevaluate how much I needed to save in the EF category to factor in inflation/and higher cost of living in NYC. So when I had to pay for that funeral bill I wasn't stressed, but ready. Since January I've been rebuilding my EF and hoping I can get it back to where it was by the end of the year. I just have to say having an EF gives such piece of mind. I felt blessed and thank god he sent Dave and Rachel my way when I needed them the most in my life in 2017 to help change my ways with money.
My stress level changed SO much when I got my 3 month emergency fund! It actually helped me transition out of my full time job because I knew I had something to fall back if I had to. I haven’t had to go back to a regular job in a year & a half! So thankful my friend got my listening to your dad & that I then found you!
Sure needed my fund this year 2021! Had to have my 26 year old leeking roof replaced on my 100 year old home. And my gas hot water tank replaced. And replaced broken clothes dryer! Also had my 2006 car worked on twice with a new battery too!I am now broke time to start saving up again!!!
Furnace died last week. Ended up replacing it. We also got about $10,000 in medical bills (after insurance) this month due to my wife's pregnancy/birth. Always put a little more in your savings in case of LIFE happening all at once.
We paid $6000 for my homebirth last year, but I’m so glad we paid in cash and don’t have anymore bills to worry about.
Just used part of my emergency fund to fix my car yesterday after my check engine light came on Sunday afternoon. I was SO grateful to have my emergency fund 😁
It is a bit sad that we need to have videos like this to guide us. Our culture promotes spending beyond our means and not waiting until you actually have saved the money for whatever it is you seek. Remember, possessions do not make us rich. Always good to have savings for those 'rainy days '.
It’s the emotions that drive us. We’re not taught how to control them, because our parents where never taught either
My car has had multiple maintenance needs over the last few years. My Emergency Fund and other sinking funds have been a blessing. Paying those back as quickly as I would like has been a challenge.
Thank you. Great to be constantly reminded.
“We have to be adults here people… we have to say NO” 🥺😂🤣😂🤣 yes this is adulting people haha
You are correct, I thought we go for 3 months emergency fund but my wife said 6 months. I am so thankful for her. Here is is my question, is it advisable to put those funds in a high yield account as a opposed to leaving them in the savings account?
I would personally say HYS since it accrues more dividends then a regular savings account
shouldn’t say 3 month; 6 month etc should say what amount covers all my deductibles; what’s my worst case 2% on homeowners + car deductible etc if you have this nothing will ever derail you.
@@jaredpeyton Our calculations are close to what you mentioned. We use our monthly expenses which includes mortgage and HOH fees.
I love your shirt!
Insurance not an investment. I like looking at my emergency fund this way. Thank you!
I just like her choices for tops. The colorful ones are the best.
So I'm renting in Baltimore and having a hard time saving I tried one side hustle which helped but I made some mistakes and backing out of it. After a nasty divorce, bankruptcy and foreclosure back in 2019 I'll be in the position to buy a house next year. Any thoughts on tiny house living it would be me and my preteen son. And where to do research for one.
With the experience that we had with covid, I think emergency fund should be for one year.
If you didn't vote Democrat, or live in a Democrat state, you probably didn't lose your job.
You know it's amazing what we found out after our mortgage got paid off that we're still spending almost $600 a month just in property taxes and insurance on the house I mean we were just shocked by that we didn't realize how much money of our mortgage payment went towards that so when we paid off the house we thought we'd have all this extra money and we really found out we didn't I mean we did have extra money but not as much as we thought I think that's something that some people maybe don't realize that in some states like where we are property taxes are outrageous so I still feel like I'm making a mortgage even though my mortgage is paid off 🙄 so the wife and I are considering selling the home and paying cash for a home in a different state where property taxes are less and we're able to save more money because the money we're giving away now is literally that we're giving it away to the tax man.
If you’re saving money for a home, I’m assuming you would set up a different account for this? Have one for 3-6months and one specifically for a home?
That’s what I’ve heard The 3 to 6 month emergency fun as for living expenses like things you can’t live without like utilities and transportation rent mortgage insurance etc and you should have separate savings worth 1-4 percent of homes value saved every year for maintenance
@marianne TY for clarifying!
@@DanielaSanchez-xf6fh np
Understand and agree 100% about emergency fund. Forgetting about interest, what about inflation? 3 to 6 months of expenses can easily lose buying power: how to avoid or minimize this without constantly funding ?
You don't avoid it. However, a large part of your emergency fund cost won't raise directly with inflation. For example if you have a mortgage a large % is fixed costs (other than the property tax and insurance portion). Every year check your budget and see if your emergeny fund matches your life situation. You may find as you becone a saver / investor your costs actually go down... or maybe you will have a life situation like having kids and 6 months feels better than 3. It will always be in flux but adding another $300 after saving up $10,000 won't be an issue.
Well I figure inflation goes up by like 10 percent, so I would add a 10% increase to what is needed for the 43 to 6 months.
If it's 20k for 3-6 months. Then I'd say make sure you have 22k for now
@@alexsale1569 Hope inflation is just 10%🤦
Hello Rachel 🌎
Covid 19 allowed me to save 6mo fund and more and was a wake up call to get out of debt invest and pay down mortgage
Do you have bank recommendations? I noticed you mentioned an online bank and I've been interested in other banks besides the mainstream (US, Chase, ENT, etc).
Any FDIC insured bank or credit union will work. A small local bank savings account not linked with a debit card or online transfers may actully help seperate a real emergency from just a want. The yearly interest is so low no matter where you put it that doesn't matter in my thinking.
I prefer 12. I'm just over cautious ⚠️
Due to the current inflation , baby step 1 is now $3,000 😎
Nope. CNBC did a study last year and 60% of Americans don’t even have $1000 in a savings account. That’s still a significant milestone for most people.
What is a money market account?
Given that I can get my assets out of my investment account in 2 work days, I have my savings there. That being said I do have extra 3 months of expenses saved in my checking just to be safe but all my savings go to investment. If you are a young couple really no sense of having that money just not doing anything
The sense in having the money not doing anything is so that you don't need to pull out of the market when it's down. Like with the 2008 or 2020 crashes where the market temporaraly was cut in almost half. Suddenly your 10k emergency fund is 5k. Doubling your money with compound interest takes 7ish years so you lost 7 years of progess due to pulling out at the wrong time. This is also why 401k loans are a bad idea. The money is removed from the market where it should be growing. The emergency fund is like no deductable insurance... you are giving up some returns for the security of yourself and invested assets.
Step one: keep a job.
u have to live. My kid and I just spent $600 on a 2 night stay at a resort (games, indoor water park). Same place from 2 years ago where I remember everything. I’ll always remember these moments, they r priceless. I looked at my bank statement and I have just enough to pay the mortgage and monthly bills this month. I’ve been throwing 600 a month extra at the mortgage. I won’t this month, but o well. I guess this is the guy thing you’re talking about, lol (which is true). I am in baby step 7, but skipped 3. I always say all you’re money needs to be working (that’s either paying down mortgage or investing). Can easily always figure a way to pay bills/mortgage. I’m happy I’ve made this decision. Although, a emergency fund is a good idea for most people and I hope to work on it this year. Once I get to that goal thought it’s probably going to be spent on a dream ($5000) vacation or invest it.
Honestly, with this CV19 garbage, you need to have a year of resources available to you as an emergency fund.
👍🏾
unexcepted for me was a new mattress set and new battery lol
So do I have to do step 1 for 6 months or is that something else ?
Are you talking about the baby steps? If so baby step one is to have the 1000 emergency fund as a starter then once you’re done with step two getting rid of all your debt except the mortgage then it’s step three and and you would just build your 1000 emergency fund to 3-6 months for your living expenses
@@mariannebrandon8891Thankyou!
Need to spend less and make more.
Don't do 90 day mortgage notes at 100% financing
But Rachel I assume you have a separate "Taylor Swift Concert Ticket" fund you use to buy those TayTay tickets?
Sure it’s called a sinking fund
Or just set up a YOLO fund so you can buy the Taylor Swift tickets
I don’t get it, Robert Kioyaski built his wealth on debt but The Ramsey show tells people to get out of debt. It’s such a contradiction
It would seem so, however don't forget Dave's backstory. He was doing what robert was doing and it went belly up when they called his notes.
@@keithacampbell73 yep. aka survivorship bias
For me i wished i was in the position to have 9-12 months
Easy just live on less than you make...this isnt hard.
❤️
Women are conservative financially? What women are you talking about!? Where are these fiscally conservative women? How do I find them? Only one's I've met are endless money spending machines.
Like my WIFE. Couldn't save a NICKLE!!!
I was thinking the same thing😁😁
What did I just watch
1 If you all haven't seen a documentary called... It's worse than you think.... By revelations of Jesus Christ ministries... I suggest you do... All praise and glory to the most high Jesus Christ
In this economy? It’s not realistic! The essential workers have gone back to “unskilled workers” and therefore no longer “deserve” an even slightly below (inflation equivalent) minimum wage. It’s cute you guys keep the positive motivation up but it’s just not realistic and ignoring that realistic fact is just playing into it.
She appears cold and bossy
Sounds like tough love to me
She sounds smart and sassy