Comments on: Should You Have a Higher Emergency Fund if You Own Your Home?

By: You Should Never Withdraw Retirement Savings Early

You Should Never Withdraw Retirement Savings Early — Tue, 11 Aug 2015 11:14:13 +0000

[…] we discussed earlier, you could instead find other things to cut from your budget to put in your emergency fund, or to save up for a down payment on a new […]

By: Does Your Favorite Money Philosophy Trend Explain How You Feel About Dying? | When Life Gives You Lemons

Fri, 01 Nov 2013 03:00:50 +0000

[…] doubt your feelings will depend on your personal situation. Are you leaving behind a wife and kids with no savings? Are you kicking it as a bachelor with expensive belongings that will be sold at an estate sale […]

By: Lindsey @ Cents & Sensibility

Lindsey @ Cents & Sensibility — Thu, 27 Jun 2013 02:36:56 +0000

I can appreciate why you might be concerned, Daisy. There’s been a lot of flooding here in Alberta recently and countless people have lost all their possessions and homes damaged – sometimes beyond repair – in a few short days.

The scary thing is that flood damage is not covered by private insurance companies here so all those people have to rely on the federal and provincial governments for assistance. It’s a pretty precarious position to be in! I don’t want to scare you (sorry) but I know we’ve been worried about the amount we have in savings because of this flood stuff.

It sounds like you guys are really prepared though – good for you!

By: Debt and the Girl

Debt and the Girl — Mon, 17 Jun 2013 15:16:56 +0000

In a word, yes but I am in the camp that advocated for a bigger EF anyway. I just don’t like risk and like to have money that is easily accessible.

By: KK @ Student Debt Survivor

KK @ Student Debt Survivor — Mon, 17 Jun 2013 02:49:04 +0000

We have a pretty decent sized emergency fund so we don’t have specific money set aside for homeownership costs. If we need something for the home it just comes out of the regular e-fund.

By: Canadian Budget Binder

Canadian Budget Binder — Sat, 15 Jun 2013 01:33:17 +0000

We had and still do have a large amount in a savigns account even though it’s going towards the mortgage. In all the time we’ve had it there we’ve never had an emergency. We do save a portion each month for home maintenance and that we have used. It’s a projected expense in our budget and we save it until we need it because we know we will spend it at some point in time. Once we actually pay off this mortgage in the next month or so we will keep an ES just not at much as we used to.

By: Kara

Kara — Fri, 14 Jun 2013 18:51:38 +0000

One thing about e-funds is that most big spendy emergencies don’t require immediate access to large sums of money. You might need to be able to pay a smaller amount in immediate relief (say the plumber or the electrician or the guy to remove the tree from your roof) but the more expensive clean up costs are usually things that you can wait a few days for a bank transfer. Or even wait for the insurance check to come.

It’s the same with life expenses. If you lose your job, you don’t need access to $10k all at once tomorrow. You need to be able to draw on that $10k over a period of weeks or months if the job search isn’t immediately productive.

Because of that, I have what I consider a safe amount of money in an e-fund that’s immediately liquid in a savings account. The rest of the bulk of my e-fund is split between money market accounts (limited number of withdrawals per year, but a higher interest rate) and auto-renewing CDs (have to wait 6 months to access, but also high interest rates). There’s money there I can get to in a reasonable amount of time, say 3-5 business days.

If absolutely necessary and I liquidate my entire savings fund, I still have a good whack of open credit on credit cards that I could use and then pay off as soon as I could pull from my money market account.

But realistically the likelihood of needing $10k (or more) right this very minute is slim to none.

By: Bridget

Bridget — Fri, 14 Jun 2013 13:35:01 +0000

I feel like I would need a huge emergency fund to feel safe as a homeowner. Knowing I’m not responsible AT ALL for my appliances, plumbing, heating, or any other fixes of my apartment lets me keep my EF low.

By: Jordann @ My Alternate Life

Jordann @ My Alternate Life — Fri, 14 Jun 2013 12:35:00 +0000

If I was a home owner, I would definitely have a larger emergency fund. Like you said, as a home owner you are 1) expected to pay for maintenance, unlike a renter and 2) not really able to reduce you housing expenses if job loss occurs. These two things necessitate a bigger EF.