Comments on: Emergency Fund Options

By: How Much Emergency Fund Is Enough? | HarvestingDollars

How Much Emergency Fund Is Enough? | HarvestingDollars — Mon, 26 Jan 2009 01:25:29 +0000

[...] posted about emergency funds a while back, and I’d like to discuss the idea of emergency funds a bit further today. My [...]

By: Mrs. Accountability

Mrs. Accountability — Tue, 20 May 2008 01:43:54 +0000

Timely post for me. I have been thinking about putting our savings into ING Direct and wondering about the logistics of needing that money in a hurry. I guess we’d have to put the emergency on a credit card while waiting for the money to move over. Found you through the 153rd Carnival of Personal Finance. Nice to meet you!

By: Brian Nelson

Brian Nelson — Fri, 16 May 2008 16:56:31 +0000

Nice details in the article. I love it when people go beyond the "rules of thumb". One thing to consider about tapping your Roth IRA for emergencies. Although you can remove the invested amount without taxes that doesn't mean it is without consequences. There is no provision for "putting it back" after your emergency, so the same annual limit applies. So if you pull out $6,000 you can't put $6,000 back, you can only put the max for the year back. Even then, you can't make the addition you were going to make for this year. So, consider your Roth IRA to be your emergency emergency fund. That is, the funds you tap after you've already depleted your original emergency fund.

By: todd

todd — Thu, 15 May 2008 00:21:39 +0000

I completely agree. You can’t plan for everything, but if you can identify a scenario that you want to plan for it becomes a lot more manageable. Thanks for the comment.

By: KMC

KMC — Wed, 14 May 2008 19:34:58 +0000

Excellent point about thinking through what an ‘emergency’ means to you. What form your emergency fund takes is largely dependent, I think, on what kind of event is an ‘emergency.’