Show Me the Money

All the personal finance advisers seem to say that you should have an “Emergency Fund.”

I have to confess. I just don’t get what that is.

What exactly is an “emergency”? My whole life is one emergency after another.

What am I going to make for dinner tonight? Do I have the ingredients?

Medical care is one example of an “emergency” financial people always give. We have several medical bills that come due every month. For me, it’s not an emergency, it’s a regular expense. I know a lot of people who have medical bills as a regular expense.

What if you need to fix the car? Yeah, that happens pretty regularly, too, with our cars. How is that an emergency? That’s life.

If I had an emergency fund, the “emergencies” it would have to handle would make it look almost exactly like my checking account. I put most of our family income into it each month, and each month I pay the bills that come due.

So, they say I need a savings account. I ask, why?

To make interest? At 0.01% that the banks will give you? Maybe a half percent on a long-term CD? I lose money against inflation.

Putting money in the bank is just as bad as putting cash under your mattress. Maybe worse. You lose even more money on gas or bus fare to get to the bank, so the mattress is actually a better option.

Instead of an “Emergency fund,” I think I’m going to start a “mattress fund.” I’ll put half the money that comes in under the mattress. Then, when I need it, it’ll be there.

I’m pretty sure the financial advisors would disagree, but I’ve got a hunch that the best personal monetary policy is to do away with banks as much as possible, and stick with cold, hard cash on the barrelhead.

But I’m no expert. What do you think?

One thought on “Show Me the Money

  1. I have been trying to build an emergency fund (6 months of living expenses). The emergency I’m trying to ameliorate is the potential loss of my job. I don’t have any reason to fear for my job security, but if it happened, it would be devastating, especially while my wife isn’t working. Unexpected car repairs can be put in credit card (though it’s painful) and unexpected medical bills can be laid a little at a time over many years. But without money coming in, we’re sunk. Bankruptcy and the loss of our house are not experiences I want to endure.

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