I have a small but growing emergency fund ($1,000) and I know it’s supposed to total 6 to 8 months of my living expenses but I don’t know how much six months of my living expenses are. I don’t even know how much my monthly living expenses are, which is crazy because I have a budget so you’d think I’d be able to spit those numbers right out. I’ve been putting off calculating my efund total because I know it’s a BIG number and it doesn’t seem as if I’ll ever get there. I am finally conquering that fear and, according to my budget, my living expenses are at $4,100 per month. If I subtract my monthly savings it’s $3,600, then if I cut down on fast food and miscellaneous spending, canceled my gym membership, stopped paying extra on student loans, HELOC, and trimmed my tithing I will be at $3,000/month. $3,000 times 6 months equals $18,000.
If I continue with $500 a month into savings (including Roth contributions) assuming I don’t make any withdrawals (rolls eyes) it would take me three years to save the money. That’s not bad, but in reality I only contribute $175 to my efund and $125 to Roth (efund back up) and the other amount I spend as needed for car and home repairs. I probably shouldn’t use my Roth as an efund but in reality I would use that sucker to feed my kids if I lose my job. So I’m factoring it in. $18,000/$300 = 5 years. I thought it would take me at least ten years to fund that sucker.
New long term goal: have the combination of my Roth contributions and Efund total $18,000 by September 2013.
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