In your marriage, financial security or the lack thereof can cause a great deal of stress in your relationship.
One of the number one ways of ensuring that your finances do not bring you to the brink of separation is to always maintain an emergency fund.
How Much Is Enough? When it comes to an emergency fund, if you have any debt, you first need to start with a small emergency fund.
The purpose of this emergency fund is to give you and your spouse a sense of comfort that if something were to happen you would not incur any additional debt.
Husbands, this is primarily important for your wife.
She wants to know that there is a backup plan.
This is not money that should be invested.
It is there as an investment in your relationship.
I can tell you from personal experience, your relationship will be better when you have $1000-$2000 in a liquid, easy to access, savings or money market account.
Your wife will be very happy that it is there.
So, if you have any debt your first step, as Dave Ramsey recommends, is to set aside $1000.
I personally, see the $1000 as a minimum.
However, if you have any other debt I would not put more than $2000 aside.
Otherwise, you are delaying the ability to pay off your other debt.
Why Bother? Can't I Use This to Pay off Debt? First, your emergency fund is not an investment.
Well, at least not into a financial vehicle.
The money in the emergency fund is there to invest in your relationship.
It means that if something happens you have a way of paying for it.
If your car breaks down, you can afford to fix it.
If someone gets sick, you can afford to go to the doctor.
Sadly, if someone were to die, you can afford to go to the funeral.
All of these reasons are valid reasons to keep an emergency fund.
But, the only reason you really need...
is that your spouse wants one.
What If I Have No Debt? Well, congratulations.
If you have no debt, then you need to start a more established emergency fund.
Some may call this your savings account or backup plan.
Basically, now that you have your emergency fund set up, you need to extend this to include the worst-case scenarios.
What you are looking for is 3 to 6 months worth of living expenses.
Since you have no debt, it should be fairly easy to establish a 3 to 6 month cushion.
This will go a long way if, heaven for bid, you or your spouse lose their job.
Once you have 3 to 6 months set aside, now you get to work on your investment portfolio.
Have fun with that.
In closing, your emergency fund is an investment in your relationship.
See it as that and only that.
One of the number one ways of ensuring that your finances do not bring you to the brink of separation is to always maintain an emergency fund.
How Much Is Enough? When it comes to an emergency fund, if you have any debt, you first need to start with a small emergency fund.
The purpose of this emergency fund is to give you and your spouse a sense of comfort that if something were to happen you would not incur any additional debt.
Husbands, this is primarily important for your wife.
She wants to know that there is a backup plan.
This is not money that should be invested.
It is there as an investment in your relationship.
I can tell you from personal experience, your relationship will be better when you have $1000-$2000 in a liquid, easy to access, savings or money market account.
Your wife will be very happy that it is there.
So, if you have any debt your first step, as Dave Ramsey recommends, is to set aside $1000.
I personally, see the $1000 as a minimum.
However, if you have any other debt I would not put more than $2000 aside.
Otherwise, you are delaying the ability to pay off your other debt.
Why Bother? Can't I Use This to Pay off Debt? First, your emergency fund is not an investment.
Well, at least not into a financial vehicle.
The money in the emergency fund is there to invest in your relationship.
It means that if something happens you have a way of paying for it.
If your car breaks down, you can afford to fix it.
If someone gets sick, you can afford to go to the doctor.
Sadly, if someone were to die, you can afford to go to the funeral.
All of these reasons are valid reasons to keep an emergency fund.
But, the only reason you really need...
is that your spouse wants one.
What If I Have No Debt? Well, congratulations.
If you have no debt, then you need to start a more established emergency fund.
Some may call this your savings account or backup plan.
Basically, now that you have your emergency fund set up, you need to extend this to include the worst-case scenarios.
What you are looking for is 3 to 6 months worth of living expenses.
Since you have no debt, it should be fairly easy to establish a 3 to 6 month cushion.
This will go a long way if, heaven for bid, you or your spouse lose their job.
Once you have 3 to 6 months set aside, now you get to work on your investment portfolio.
Have fun with that.
In closing, your emergency fund is an investment in your relationship.
See it as that and only that.
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