Comments on: 401(k) vs The Emergency Fund

By: Denise

Denise — Thu, 11 Dec 2008 16:00:56 +0000

Bouncing Back Betty, I have to agree 100% that just knowing the money is there goes a long way in providing peace of mind. And peace of mind has a value in and of itself, huh…

By: Bouncing Back Betty

Bouncing Back Betty — Thu, 11 Dec 2008 15:12:08 +0000

When I was in fiscal meltdown, I tapped in to my 401K to try to “help myself out”. It really did not help matters at that point. Oh well, live and learn. I was in my biggest debt denial stage at that point in time and grasping at anything that might help me out.

I do have a small emergency fund now, about $1300 tucked away in two accounts. I’ve had to dip into the fund at various times during the year (replace a broken storm door, fix a neighbors truck window I broke, help with my recent car repair). I’ve had as much as $1800 in it and as little as $900. But just knowning it is there if I need it is a big relief.

By: cindys

cindys — Thu, 11 Dec 2008 00:25:49 +0000

Denise, It sounds like you are on the right track and I will put the 2 X 4 down.

Frugal Babe, I was amazed at how much less stress I felt with even my tiny little emergency fund. It is so nice to know that if the unexpected happens, you can cover it.

By: Frugal Babe

Frugal Babe — Thu, 11 Dec 2008 00:20:41 +0000

We have an emergency fund that we set up a few years ago, with an automatic contribution of $100/month into an online saving account. The first year we had it we were pretty broke, and kept raiding it to pay the mortgage. But for the last two years we haven’t touched it. My husband had knee surgery this year, and we have a $3000 health insurance deductible, but luckily we had also been funding an HSA for the last couple years, so we didn’t have to use our emergency fund to pay the deductible. I like knowing that the emergency fund money is there (and growing) just in case.

By: Denise

Denise — Wed, 10 Dec 2008 23:35:14 +0000

Well, I don’t have a retirement fund (I’m a very late bloomer) but do have an emergency fund and its for just that, emergencies. I hope to get a retirement fund of some sort going soon and when I do I’ll remember this entry and J Money’s entry, also. Hopefully, I won’t need to be smacked with a two by four.

By: cindys

cindys — Wed, 10 Dec 2008 20:03:28 +0000

LOL. Whatever it takes to get the message across. Everything you wrote is true too and sometimes people don’t get it until you smack them with a two by four. I would be one of them….

By: J. Money

J. Money — Wed, 10 Dec 2008 19:57:45 +0000

Well, you put it a lot nicer than i do I had a similar story about this idea, except i overheard it on my way in to work one day….i was going to interject, but held off and decided to post about it instead.

You’re more professional about discussing the options though – good post!