Be Prepared – Importance of an Emergency Fund
Be Prepared – Importance of an Emergency Fund
Living in southern Louisiana, having an emergency fund is critical because of so many natural disasters. We were affected by Hurricane Laura last year and we were not prepared at all. After the hurricane hit, we were without electricity for over a week and all our cold and frozen food spoiled. A few days following the hurricane, we were able to travel home and purchase a generator. We had to buy it on credit though because we did not have an emergency fund set up for the type of disaster we were experiencing.
Since the hurricane, my husband and I made a promise to ourselves that we would ensure we were prepared for anything like this in the future. An emergency can happen at any point in time, and it is important to have resources to rely on. We now put $50 into a savings account every paycheck, which ends up being roughly $200 a month between both of our incomes. There are some months that we may only be able to do $100, but we do our best to make sure we have some type of funding to lean on in case we ever experience something like this again. Generators, gas cans, gas, extension cords, and similar items all add up quickly and you most definitely need to be prepared if you live in areas where there is a potential for a natural disaster.
This is a picture of me and my husband after Hurricane Laura.
MilSpouse Money
Mission Response:
Thank you for sharing your experiences, Karissa. The storm and aftermath must have felt scary and uncertain. We’re so glad you’re okay. Great job on following through to set up an emergency fund after this experience! While we can’t predict when or where we might have to deal with a natural disaster or emergency, there are things we can do to be prepared. Visit Ready.gov and Military OneSource for disaster preparedness information and resources. In addition, you may seek help from your service Relief Society or the Red Cross. Another topic related to emergency preparedness is insurance. Review your insurance coverage annually to make sure it fits with your needs.
An emergency fund is an important component of your overall financial security and preparedness. All of us will have to handle unexpected events at some point, whether it is a broken-down vehicle, job loss, natural disaster, or another emergency. Financial experts recommend you keep three to six months’ worth of living expenses saved in a separate, easily accessible account like a money market or savings account. If this seems like a lot of money, start with a goal of saving $1,000. Prioritize saving each pay period. Consider automating contributions to make it even easier to reach your goal. Having an emergency fund can’t prevent the unexpected event, but it can make the experience more manageable and save you money in the long term by avoiding debt.
