VISA, Mastercard, Discover, AMEX For Emergencies?

I read THIS ARTICLE yesterday.

All I could think was "But for the grace of God, there am I!"

Here are some lines that stood out to me:

  • … consumer borrowing rose at an annual rate of 7.4 percent in November
  • … The category that includes credit card debt surged at an annual rate of 11.3 percent …reflecting the fact that shoppers are continuing to rely heavily on their credit cards to finance purchases …
  • … Economists believe that consumers are being forced to rely more heavily on borrowing on their credit cards with the collapse of the housing market …
  • The overall increase left total consumer credit at a record $2.51 trillion.

There was a day where a market like today's market would have CRUSHED my family's home economy.  And it would have been ALL MY FAULT because I was managing my money HORRIBLY!

The above article just reinforces the absolute necessity of having an Emergency Fund.  The more, the better!  At least $1,000.  If you have children or own a home, make it at least $2,500.  If you have paid off all of your debt except the house, make it three to six times your monthly expenses!

That is a decision I have NEVER regretted!

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5 Comments

  1. Saving Freak on January 9, 2008 at 8:05 am

    There is a great amount of comfort in having a large emergency fund. My wife and I have 13k in the bank and feel that is enough to support us for about six months if we both lost our jobs. If anything happens we are pretty much good to go whether it is the house, car, health, or any other odd emergency. Money doesn’t stress us out.



  2. chris on January 9, 2008 at 10:03 am

    Like Saving Freak, we have a six buffer of expenses saved. We are so fortunate to have been able to do that.



  3. moneymonk on January 9, 2008 at 10:10 am

    I think this culture makes it so easy to obtain credit that IRA and savings get pushed to the backburner.



  4. April on January 9, 2008 at 10:15 am

    This article has some really good tips for earning some extra cash………….it may be a solution to your saving problems. Instead of trying to cut your already tight budget, make some more money.

    How to earn extra cash!
    http://www.ehow.com/how_2112938_earn-extra-cash.html



  5. Daniel on January 9, 2008 at 9:07 pm

    We just got our $2500 savings, not 13k, but a start nonethe less. 4 months in on our debt freedom march! We will be debt free someday!, in 32 months to be exact, but my stretch goal is 24! We will see how that goes!



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