Emergency Funds: Use Them If You Need To

So You Have an Emergency Fund

Good for you for putting money aside for emergencies. A lot of people live paycheck to paycheck and you’re one of the lucky ones who figured out how to break the cycle. It says a lot about you that you had the drive to put all of this hard earned money aside and I bet it wasn’t an easy task. Whether your emergency fund is $1,000, two months worth of expenses or a year worth of expenses you did a good job to get started or to have a fully funded fund.

An Emergency Pops Up

You need to figure out is this really an emergency. Finding a great deal on that car you always wanted is not an emergency. Neither is getting the new Apple MacBook Pro even though you really, really want it. If it is unexpected and health related chances are it is an emergency although getting braces probably isn’t. Losing your job when you were the only one bringing in money is definitely an emergency. Just be honest with yourself.

If it is really an emergency and you don’t have any other options beside going into debt USE YOUR EMERGENCY FUND MONEY!!! I recently have read about people who run into a financial emergency and don’t want to spend their emergency fund that took so long to fill. Instead they decide to go back into debt and pay interest which really isn’t optimal.

You built your fund for a reason and that was so you wouldn’t have to go into debt if an emergency came up. Well… it happened and you were prepared. Don’t feel bad! It might take you a while to build it back up but it won’t be nearly as long as it would be to pay off a high interest rate credit card.

If you do have some money elsewhere that you can use I would definitely suggest you use that first. I’m not saying to break into your retirement account because you shouldn’t. However, a vacation fund would be a possibility. It wouldn’t be fun but you would still have your emergency fund intact.

You Must Remember That Something Worse Could Happen Tomorrow

If you had a minor medical emergency there isn’t anything that says a major medical emergency isn’t right around the corner. You could lose your job next month if the economy tanks again like in 2008. We can’t predict the future. If something like this happens you’ll be glad you skipped out on your vacation and still have that emergency fund.

In the end it is a judgment call. Only you can determine whether or not to break into the emergency fund. Just remember why you saved it up in the first place and use it accordingly. Don’t feel guilty if you really truly have to break into it for an emergency.

Have you ever had to dip into your emergency fund? Why dip into it and how long did it take to fill it back up?

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About Lance Cothern

Lance Cothern, a Certified Public Accountant (CPA) licensed in the Commonwealth of Virginia, is the founder of Money Manifesto. You can read more about him here or connect with him on Facebook, Twitter, Google+ or Pinterest.


  1. I dipped into the fund when my wife went out on maternity leave. I’ve found in general, the emergency fund comes into play when you have zero money to pay your bills. That’s the only time that I’ll use it and I’ve gone a decade (until recently) without tapping into it.

  2. I really don’t like dipping into our fund but we’ve only had to do it once in the past 5 years. With that said, that ONE time was last month when we bought new tires for our car. We had other money saved for “car replacement” that we could have taken from to cover it but we chose to take it from the E-fun as our “car repairs” fund was also down to $0. Drat!

    • Tires are very important. You probably could have saved for it but if you didn’t have the money car tires are definitely more important than not dipping into the e fund.

  3. The fund is there for a reason, to assist with emergencies so if one strikes use it. However, try not to drain it. Something else might come up right after the first. I would also add that you should replenish them as fast as you can if you do use them. Disaster can strike anytime.

  4. I do not have what many call an emergency fund! I have savings, but I don’t call it an emergency fund because I can handle most emergencies from cash flow. Despite that statement, I am buying a new refrigerator this month and am using my savings.

    • Savings and efund can be one in the same. If you don’t need the mental division there isn’t really a big need to have one.

  5. We haven’t had any emergencies so we haven’t used any money from our EF. However, our EF is way too small and we have “other” savings that we dip into when we have occasion that probably should be in our EF and not being touched. So it’s a bit of mental gymnastics.

  6. We have a savings account as well. Most emergencies are used with a credit card which we pay off each month. Putting it on a credit card that generates points and buys us some time before we have to pay it off is a great way for us to use regular cash flow rather than our savings.
    Be careful, though…be sure to pay off the credit card bill every month. It is better to use some EF money or savings than it is to not pay the credit card bill or leave a balance on it and pay 18% or 21% or even 24% on it!

  7. I just used my emergency fund for the first time!! I have been putting off getting new tires and I don’t have a car repair fund! We had heavy rain last weekend and my car was sliding all over the road. I didn’t want to chance having a wreck so I got new tires Thursday. There’s $600 that will have to be replenished.

  8. The problem is that far too many people do not know the difference between a need and a want like you mentioned when they consider dipping into their emergency fund.

  9. Ethan's Money says:

    I’d be nervous about having an emergency fund of only two months and then dipping into it for occasional expenditure as well.

    You need to have a plan in place so that if you lose your job you have enough cash to survive for 6 to 9 months. This doesn’t need to be cash in a deposit account – it could include redundancy money, cashing in investments, or similar.

    But if you lose your job and only have 4 to 8 weeks of cash available, then that’s asking for trouble. It can take longer than this to find a new job.

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