A while ago I decided to save some money just in case I get fired one day. It was too often that I was hearing stories of people losing their jobs and then spending months looking for a new job. As I was (and still am) living alone and renting my apartment I knew that in the moment I lose my job I need to have some savings or I will soon be homeless. Or back at my parents’ house. Not sure which would be worse.
I was never a big spender, but I was also never a big saver. Most of my life I was spending just as much as I was earning. If I would compare myself with people around me I would say I was doing well because at least I didn’t have any debts most of the time.
I came up with the plan to create emergency unemployment fund that will keep me safe for at least 6 months. Six months seemed like a reasonable time.
It all started very well. Saving 20% of my salary and sometimes even more every month was easy at first. I was kind of proud of myself and feeling all grown up. It was a good plan.
No matter how good every plan has a flaw. Unexpected costs are the most likely flaw in any emergency fund plan. For me it was for a good thing, but that didn’t make it less expensive. I took the money from my emergency unemployment fund to invest in my education. Later on I also decided to buy a car and the total of monthly expenses went up.
By the time I actually got fired I almost managed to go half way – I saved enough money to be able to pay for all cost for 2-3 months without getting a salary in that period. Two if I keep the living standard I have now, 3 if I am very careful when buying food.
Looking at how I feel today I believe the decision to create this unemployment emergency fund was one of the better ones I ever made. Even with this half emergency fund in my pocket I am panicking and hyperventilating from time to time. The thought of not having anything saved and being fired is just paralyzing.
Being paralyzed is not the best condition to be in when looking for a job. Don’t be an extreme cheapskate, but try to build at least some kind of emergency fund. The worst thing that can happen is that you never use it.
I am so! fired 