Welcome to the third email in my July “Live an Above Average life” series. In the last email, we talked about understanding what enough means to you and knowing when to just stop. Today, we’re talking about emergencies.
Quick, answer this question: If you lost your job today, how long could you live your normal lifestyle before having to worry about money?
If your answer was three months, then you’re doing well. If six months, you’re doing even better. And, anything longer than nine to 12 months and you’re super prepared to weather a LOT of storms out there.
My wife and I possess several years of living expenses in case something seriously bad happens, like:
Above average people have enough saved up – often in a savings or money market account, to withstand temporary blips to their livelihood. Let’s face it: It’s nice not to have to worry or flip our $hit if we suddenly lose our jobs, isn’t it?
If you don’t have much in the way of emergency savings, fix that problem. Now. Start small, but continue to build your pot of cash until you can live safely for at least three to six months without a dime of income. Open a savings account. Get ‘er done.