Emergency Fund Talk: When it becomes a BIG DEAL

There’s a guy I know who has a good paying job ($120,000 a year), lives with his second wife plus he still has alimony and child support and is starting to feel the financial pinch.

Where do I begin?

His mom is sick and he has to fly at $1200/pop to deal with the situation (she lives in another city) and his basic savings are running out. He simply didn’t save enough for an emergency fund, because he told me he never imagined that he’d have problems, seeing as he earned $120,000 a year.

He’s flown about 3 times so far, and his savings are already drained, he says.

He’s starting to run out of money, and he’s getting stressed at work, scared he’ll lose his job and end up not being able to care for his mother and to lose everything, 10 years short of retirement.

Speaking of retirement, he can’t afford to retire, and jokes he’ll work until he’s 100 because he can’t afford to retire now.

His job is not in jeopardy (good, GOOD job in a solid position and industry), but for some reason he can’t seem to save enough every month.

I do hear snippets, and it sounds like he went on a couple of pretty amazing trips around the world; seeing as he doesn’t travel on a budget like we do, I have a feeling he spent about $30,000 in his lifetime on these trips.

It made me re-evaluate my decision to spend $10,000 to fly to Asia and do a one big tour when I could just save the money for an emergency.

Ultimately, even if I could save the cash, I still went through with my Asia trip because:

1. I’m young
I’m not nearing retirement, so I don’t need the money quite as definitively as he does.

2. I have the money
I have the liquid assets to spend $10,000 without putting myself or my future in jeopardy particularly since I regularly live on a low amount of money.
I estimate that I’d have about $85,000 left in liquid assets after my trip which is more than enough to cover our upcoming move and whatever else that might come along.

3. I won’t be traveling for a long time after this last trip
After this one last big trip that we’ve been planning on and off for 2 years now, I won’t be traveling for a while. We’ll travel within the States, but we won’t be going overseas a lot (if at all) especially when we start having kids.

Still, hearing stories like this makes me even more committed to keeping an even keel on expenses and seeing the big picture on a daily basis.

Related Posts

Savings versus Emergency Fund: What’s the difference?
 
What are your emergency fund rules?
 
Talk about money. Talk about it often.
 
Yuppie Guilt and how to deal with it delicately
 
Why I don’t talk about money with co-workers or friends
 
When is paying more for quality a big deal for you?
 

About the Author

Just a girl trying to find a balance between being a Shopaholic and a Saver. I cleared $60,000 in 18 months earning $65,000 gross/year. Now I am self-employed, and you can read more about my story here, or visit my other blog: The Everyday Minimalist.