In Case of Emergency

Picture, if you will, a woman heading to work in rush-hour traffic on a Monday morning. As she heads north on the on ramp to I-405, her car's engine starts revving up to 5500RPMs. The woman presses her foot on the gas pedal, but the car barely lurches forward. The woman flashes her emergency lights and futilely attempts to guide the car to safety. Angry motorists whiz by without consideration. Finally reaching the shoulder, the woman calls AAA and waits to be rescued. Unfortunately, the shoulder is so narrow that two of the car's tires cover the painted line separating the shoulder and the freeway. Trucks veer into the next lane trying to avoid the stalled car. An accident is waiting to happen.

Hopefully, you haven't experienced anything such as this, but this is how my week started in real-life, not just a hypothetical. While I was told — very calmly — by the AAA operator to "stay in the car to wait for the tow-truck driver," my frazzled nerves and inner conscience were saying "get out of the car." "Now." Instincts won the day, and I climbed over the barrier and into the blackberry bushes and waited.

The woman's advice, while sound, was not useful to me. I didn't want to be sitting around just waiting to be hit-especially as my car was in a precarious position and the vehicle was essentially inoperable. Such is the case with good advice. Good advice is good — until it isn't. While there could be both financial and non-financial lessons to this story, all I want to highlight this week is simply: Do you have an emergency fund, and if you do; is it enough to cover one of life's various and sundry small emergencies?

With the litany of things for all of us to do to be financially independent and secure, it can be a challenge to get too excited about starting or continuing to fund your EF. Whether you call it an emergency fund, a finacial cushion a rainy day fund-or something else altogether-there are some compelling reasons to "strengthen your savings muscle:"

1. You won't have to sell assets at a potential loss or pay a penalty tax for withdrawing funds early.

2. You won't have to take on additional debt.

3. You will find that "instant gratification" can be found in watching your account grow, and it's a good habit to establish or continue throughout your life.

4. Why add financial stress to your already stressful situation? If you have an emergency fund, you won't have to relive your challenging event every time you open up your statements.

In the past three weeks, alone, my garage door died, my car died and I have a leak in my kitchen. None of these "little emergencies" has been particularly welcome, but things happen and we need to be prepared.