Here is a thought

You need an 'Emergency Fund'...

...no matter your wealth

// THREAD //

1. Life is full of surprises

You don't know what is around the corner

You can't predict the unpredictable

Roof leak
Car accident
Washing machine blows up

..or worse

Death
Divorce
Sickness
Redundancy

Sometimes, life smacks you in the face

Be prepared

2. Cash Is King

Cash is king when shit hits the fan

Hold at least 3-6 months expenses in cash.

Then, in an emergency:

You can buy anything
You can buy it quickly

But...

3. Cash Is Terrible

Cash saving rates are dire

Inflation destroys your cash buying power

And that destruction compounds

So, many want to put their money to better use

...Let's debunk some of the 'better uses'...

4. Use Credit Cards

Some say use credit cards for emergencies

Most are only 30 day interest free

You can't pay your mortgage on CC

Replenishing your emergency fund takes longer

A second or third emergency hits, you are at risk of spiraling into huge CC debt

5. Invest It All

Why not sell your investments in emergencies?

Liquidity - 3 days for your trade to settle, days for funds to hit your bank. Won't help your emergency, RIGHT NOW.

Market Downs - Emergencies often hit when markets are down. You realize losses.

6. Cashflow Instead

Have cash flowing assets. Like Real Estate, or a Business

Works unless your assets are coupled to your emergency.

Take the pandemic

It's been legal to accrue rent arrears. Landlords have no comeback

Many businesses forced to close

7. Cash IS King

..for when shit hits the fan

Here are 10 sane ideas for how to manage your Emergency Funds

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