The Emergency Fund

Hello long-lost friends! I am back after a couple of weeks of studying, exams, and wedding travel. And since my last two weeks have been somewhat chaotic, it seems like a good time to talk about how to keep your financial sanity during times of surprise expenses.

The issue of emergency funds among personal finance bloggers tends to be a bit divided – with some of the opinion that emergency funds are crucial and others writing that they are not necessary at all. While there are compelling arguments for both sides, I must admit that I am in the first camp – for me, an emergency fund is a must-have.

The good news about emergency funds in Canada is that Canadians have an average of $41,694 in emergency savings. That’s awesome.

The not-so-good news is that a quarter of Canadians don’t have anything set aside for emergencies at all. And of those who do, almost half have less than $5000 saved. Not awesome. (source)

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You Don’t Need Balance Protection

When I was 18, I moved from being a secondary card holder on a credit card shared with my mom to principal holder on my own shiny new credit card. When I called to activate it, the agent asked me if I wanted to add insurance that would cover my balance if I lost my job or had a disability. Being young, naïve, having no other insurance, and thinking that banks were always looking out for my best interest, I agreed. I had it for years before I cancelled it.

Do not make the same mistake I did. You don’t need balance protection insurance.

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Sh*t Happens

Guys, I’m in an interesting mood today. I’m in a financial funk. Does that ever happen to you? It’s a beautiful day outside, the sun is shining, I’m fresh off a great long weekend, and yet, I’m feeling kind of down.

The first reason is that I’m looking back at the month of July, which was a month of setbacks for me. I started the month off with a mechanic’s bill that was almost $600 more than I expected. I had to replace a headlight and a taillight in the same week. My trusty flat iron died. (You may be thinking this is not a big deal and I could just wait to buy a new one in a couple of months, but guys – I use this thing every day to avoid looking like a yield sign. I grieved.)

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