Unfortunately, at the end of March, my grandfather passed away. It was a devastating time for my entire family and I not yet over it, as can be expected. I miss him a lot.
From a financial perspective (the whole point of this blog), it was quite pricey. I had to fly home and then drove back and forth between my parents house and my grandparents house (about a five hour round trip) a number of times. So flights, petrol and all the other little things really added up.
As I have been putting all of my extra money onto my car loan, I didn't have any money sitting in the bank in the form of an EF. So I had to use my credit card. I paid it off a week and a half later when I got paid next without accruing any interest but still, I'm not sure if it's a particularly good way to live. In fact, I know it's not.
But I am just so desperate to pay my car off that I have forgone all other saving. Can anyone offer some sage advice? I really need it right now!
Well now you've seen first hand why you need to have an emergency fund! What if you'd had a bigger/pricier emergency, or multiple emergencies at once - like your car needing to be fixed on top of a pricey mandatory trip? You might have had to charge so much that you couldn't pay it off before being charged interest.
ReplyDeleteI'd commit to at least saving 5% of your gross income in an EF each month; and then put any extra savings to the car note if you want to on top of that.