Friday, February 11, 2011

The importance of an emergency fund...

or goodbye new TV...
This week, I learned a valuable lesson: An emergency fund is crucial to one's financial life. Basically, having $60 of forgotten money is not going to get you anywhere in an emergency. When did an emergency ever only cost $60?

I had a very bad week.
It started with a trip to the dentist, after which I found myself swollen like a chipmunk and holding a bill for $160.
My dental benefits failed me here.
Something about the dentist using a fancier filling?!.
My old company's benefits would have fully covered this. My new benefits may say 100% but they mean 70%. Next time, before they do any craziness in my mouth, everything will go through the insurance company first and if they have to use the normal, not fancy fillings, they will use those.

After this, I found myself in a bit of a medical emergency which resulted in a $45 ambulance bill, $15 hospital parking and then $400 scratch on my car.
After my hospital visit, I was not well enough to drive my car, but I did. I needed groceries and in the parking lot I miss judged my size vs. a tiny parking space and the scratch happened. In over 10 years of driving this is the first time I have done something like this. The scratch is minimal, but my brand new shiny car cannot stay like this. It is driving me crazy and I will get it fixed on Mar 2. I did some comparison shopping and the $400 is really the best offer.

I am hoping that the benefits, which by the way are making mad as they 'suck', will cover the ambulance bill. *Cross fingers*

And if you are counting this is $575 of expenses I have not budgeted for at all.

Ladies and gents, emergencies happen to the best of us and we have to budget for those.

I will pay the $400 from the money I have put aside to transfer over to my RRSP on Feb 18th. This means that I will miss the 2010 deadline for the $400. I am happy that because I was putting money away, I have the money to pay for the repair. If I had I moved them into an RRSP, I would not have it available. This is where, I scratch (ha scratch!) my plan to double my RRSP as my emergency fund.
Going forward I will start setting money aside for emergencies.

Also, my cheque for grading papers should come in the next 30 days and instead of going into the new TV fund, it will cover the other outstanding bills.

Good times, no!

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