Budgeting for an emergency


Budgeting has never really been my thing. Money burns holes in my pocket about as fast as bolt of lightning appears in the sky.

Thankfully, my wife makes up for what I lack in that field. She keeps me a safe distance from most of our money and puts it to its assigned use before I get a chance to spend it foolishly.

I’ve worried, though, that our daughters would be possessed of my money-management genes and not their mother’s.

The jury is still out on our youngest child who is still in school and living somewhat on our dime.

Our oldest daughter, Anna Kate, though, has passed the gene test with flying colors. She has followed her mother’s advice and built an emergency fund and she has included savings as part of her monthly budget. That first step – the emergency fund – is going to come to good use much more quickly than she, or I, ever hoped it would.

Anna Kate called me Friday night and I could tell from the tone of her voice she had a problem.

“I need help. I just had a wreck in the parking deck. I don’t know what to do,” Anna Kate said in her low-pitched, staccato voice.

After I made sure she wasn’t hurt, I listened as she explained that some coming toward her had turned a corner too fast, forcing Anna Kate to veer off to her right and scrape the side wall of the parking deck.

The damage to her car seems to be just cosmetic, so that’s good. I told her to report the wreck to her insurance company and find a body shop to give her an idea of how much it would cost to fix.

She called back Saturday morning to say she’d been to two repair shops, one that couldn’t do the work and the other where the body shop was closed. One man at the dealership with the closed body shop estimated the damage would cost $3-4,000 to fix – far more than she had in her emergency fund.

When I explained that she would only have to pay for her $500 deductible, the tension in her voice melted away.

And, while she’s angry at the disruption caused by the wreck, I get the sense she’s more frustrated by having to dip into her emergency fund.

She started talking about how long it was going to take her to rebuild her emergency fund to an acceptable level.

As I listened to her, I thought back to the time when I was her age. If I’d been in her shoes, I’d have been thinking about how I could spread payments for the work out over time or what other scheme I could dream up to avoid destroying my cash flow.

She’ll get through this “emergency.” She’ll learn something from it. And the next time something like this happens – and it almost surely will – she will be better prepared to deal with it.

Now, if we could get the federal government to manage its money the way Anna Kate has started off, we’d all be better off.


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