If you are retired, do you keep an emergency fund? (state, separate)
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Location: Formerly Pleasanton Ca, now in Marietta Ga
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If you are retired, do you keep an emergency fund?
Do you have cash outside your retirement nest egg to use an emergency fund, or is your nest egg the emergency fund in itself?
Long story short is I wound up retiring early having invested in rental houses and making enough to retire early. I plan on fully spending every month the net rents that I get. Before I even collect the rent I put aside 10% of the gross rents for repairs. Basically I guess my situation is a little bit different than others in that mine is all in real estate and many others have their money in stocks etc. so in the traditional sense I am never really pulling out any of my principal since I am not selling any of the houses and they are all paid off.
I don't know if there's anyone else in this situation here on this forum but since there are other retirees here I'd like to see what they think. I recently posted this in the personal finance forum and someone's suggested that it might be better to post this question here.
Thank you in advance
If you are retired, do you keep an emergency fund?
Do you have cash outside your retirement nest egg to use an emergency fund, or is your nest egg the emergency fund in itself?
Long story short is I wound up retiring early having invested in rental houses and making enough to retire early. I plan on fully spending every month the net rents that I get. Before I even collect the rent I put aside 10% of the gross rents for repairs. Basically I guess my situation is a little bit different than others in that mine is all in real estate and many others have their money in stocks etc. so in the traditional sense I am never really pulling out any of my principal since I am not selling any of the houses and they are all paid off.
I don't know if there's anyone else in this situation here on this forum but since there are other retirees here I'd like to see what they think. I recently posted this in the personal finance forum and someone's suggested that it might be better to post this question here.
Thank you in advance
If you spend all your monthly net income what happens if a large unexpected expense happens like needing a root canal which costs 3 months of your net income. With no emergency liquid funds on hand to cover that expense what are you going to do put it on a high interest credit card and pay it off monthly ?? This is just one example why most people have an emergency cash fund because it is cheaper to pay the emergency cash fund back than to pay the credit card company.
I am not retired but I do have emergency funds. I've opened savings accounts for major events like health, roof/home systems/appliances, and new car. Every month I treat each of these savings accounts like a bill and I deposit money into them. When I have an emergency I go to the specific savings account and I use the money. Otherwise, I just let it sit earning very little, but at least it is there when I need it. I've decided not to include these accounts in my net worth as I figure they are future expenses.
If you are retired, do you keep an emergency fund?
Do you have cash outside your retirement nest egg to use an emergency fund, or is your nest egg the emergency fund in itself?
Long story short is I wound up retiring early having invested in rental houses and making enough to retire early. I plan on fully spending every month the net rents that I get. Before I even collect the rent I put aside 10% of the gross rents for repairs. Basically I guess my situation is a little bit different than others in that mine is all in real estate and many others have their money in stocks etc. so in the traditional sense I am never really pulling out any of my principal since I am not selling any of the houses and they are all paid off.
I don't know if there's anyone else in this situation here on this forum but since there are other retirees here I'd like to see what they think. I recently posted this in the personal finance forum and someone's suggested that it might be better to post this question here.
Thank you in advance
Yes, we have a savings account for emergency purposes, and we also use that account for making big ticket item purchases ( like cars) for cash when we are ready to do so. It's separate from our investment funds.
I am not retired but I do have emergency funds. I've opened savings accounts for major events like health, roof/home systems/appliances, and new car. Every month I treat each of these savings accounts like a bill and I deposit money into them. When I have an emergency I go to the specific savings account and I use the money. Otherwise, I just let it sit earning very little, but at least it is there when I need it. I've decided not to include these accounts in my net worth as I figure they are future expenses.
We have always done that too. The interest rates on those savings account are ludicrous at this point, but having that money handy can sure keep you from having to go into major hock in the event you really need that money for an emergency or unexpected expenses.
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