Breaking glass window with a hammer to pull down emergency lever
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What is an Emergency Fund and Why do I Need One?

by Manny Ikomi

July 17, 2020
2 min read


  • Emergency Fund
  • Saving

Life Can be a Shady B*tch 👎🏽

We don't know when life will come for us, but at the very least we need to  recognize it’s inevitable. Wether it’s car repairs, unemployment, medical expenses or even a stolen wig; sh*t happens and we need to have cash on hand to deal with it.

An Emergency Fund is cash savings set aside for unexpected emergency expenses.

Piece of Mind 😌

Having a stack of cash ready for almost anything that life throws at you affords a certain peace of mind. It's much like being debt-free except even better. It's your own personal safety net that you have control of and access too at any time. It can fill the gaps between insurance or unemployment and eases the paycheck to paycheck lifestyle.

As my own emergency fund grew I realized most of the suprise expenses I would normally stress about (especially car repairs) were reduced to an inconvenience rather than catastrophe. Recently during COVID-19 my emergency fund was essential for over a month while I was waiting for my full unemployment benefits to kick in.

Stay out of Debt 🙅🏽‍♀️

One of first places people go to cover emergency expenses aside from savings are credit cards. Although credit cards can be a great financial tool they can hurt you way more than they help. Going into debt for an emergency expense you couldn't afford to begin with only further perpetuates being broke. In the case of credit cards, you're likely paying interest on these expenses which only compounds the issue.

Having an emergency fund helps you approach the problem with more than $0 instead of already being in the hole for your usual expenses.

Take on More Risk 🤔

With the piece of mind and safety net that comes with an emergency fund it also gives you access to opportunities you couldn't risk before. A great example of this is being able to invest in the stock market and sustain doing so over extended periods of time so your money can grow. It can also help you quit your job and start your own business or even help out a friend in need if you can afford it.
This doesn't mean your investing the emergency fund to maximize gains or using it as seed money for a business, it means if your risk fails to see any reward it won't jeopardize your livelihood.


Once you have an emergency fund set in place and any debts under control it's much easier to plan for the future, grow your money, and deal with life's set backs along the way.

An emergency fund is like the lube to life. It makes getting f*cked just a little easier.

Next in the series:

How Much Should Your Emergency Fund Be?

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nuOpulence © 2021
by Manny Ikomi