Emergency Fund - Saving the Day

🗓️ Today’s Foresight - The Emergency Fund

Life is at least predictably unpredictable. We have to plan ahead. Layoffs happen, cars break down, house things just randomly break, and pets eat something silly like a string that requires them going to the vet where they ultimately just spin them around on a chair to induce vomiting (true story!). But we can build a war chest to battle these as they come up so today we’re talking about the emergency fund.

🚀 Saving the Day Tomorrow, Today!

Emergency Fund

• First savings goal - the emergency fund: This is money specifically for REAL emergencies. Cars break down, tires pop, faucets leak, and layoffs happen. It should be saved in a savings account - not invested in the stock market and ideally separate from the checking account so we aren’t tempted to spend it. This is money to pay for unexpected things and the general rule of thumb is:

• Six months of expenses: This is a general suggestion - can be lower, can be higher. Create comfort. Does three months make you nervous, is nine months enough? Months of expenses is a way to think about it if you were to lose your income. The idea is we can hopefully find a new job in that time and still pay the rent/mortgage, groceries, and other bills for a time without new income. We’re not really adding to investments here - we’re literally keeping the lights on. But this is also:

• Healthy enough for a large one time expense: It might not cover everything, but it is super handy to have in those true emergencies that are a surprise - new tires, car repair, big house cost, or medical bill.

• The goal is safety: The emergency fund is the one that helps us sleep at night. Car breaks down? Not the end of the world. Wake up and company downsizes us? Well, we have a bit of a buffer as we keep moving forward. We can’t SEE the future despite how hard we try, but we can be ready for when it slaps us in the face. What makes YOU comfortable?

• Patience: It can take time to save up money for this. Between other bills and the daily needs that seem to take our money, building an emergency fund that is comfortable for you can take time. Slow and steady wins the race.

😋 Frugal Food - Pantry Prepping

Not a recipe exactly, but building a pantry filled with basics goes a long way with meal prepping and saving money because we end up keeping certain staples on hand instead of having to go buy everything all the time.

Pantry Staple Ideas

• Rice: Rice can be used in a huge number of recipes and you can buy it by the sackful.

• Beans: Rice AND beans! That’s a meal in itself. There are a multitude of beans out there - buy what you like. You can save even more $ by buying dry beans in a bag and cooking them yourself. Personally, I tend to go for canned beans because I love saving money, but I also love saving time.

• Canned Soup: Sure, we often think of soup as a when-we-are-sick food or a food for winter. But it is easy to store and easy to cook.

• Pasta: Similar to rice, pasta is a base for a lot of great meals.

• Freezer: Don’t eat your freezer, but it is a perfect way to save meals for later and to make food last longer. Batch cooking and saving food for later is a help during the week when you don’t feel like actually cooking (you’ve already done the work!). We are fans of microwaves here.

🗞 Financial News Bits - April 19, 2025

Stocks and Stuff

• Capital One and Discover merger approved - CNBC

• Nvidia’s 2025 has been tough - Yahoo!Finance

Other Stuff

• A proposed bill would create retirement plans for those without access to a 401k - Yahoo!Finance

• Nintendo Switch 2 price is still $449, but accessories will cost more - Game Developer

❓Q&A - Send us your questions!

Today, we’re pulling from Reddit: Dry_Arrival_4853 asked r/FinancialPlanning “Should I put extra cash toward my mortgage or invest it instead?” They’ve gotten lucky and won some money at the casino (honestly a little jealous there). They have a low interest mortgage, no other debt, an emergency fund (yay!), and max out their retirement contributions.

This can be a whole post in itself. There’s generally two schools of thought:

1.) Growing in the market - With a low 3% interest mortgage, this person can probably invest their new money and earn 6-9% a year. I would probably do what we’re going to call a “bridge” account - a brokerage where they can get their money whenever they want and not have to wait for retirement for it. The “bridge” is bridging the gap between when they want to retire and when they can actually access all of their other retirement funds.

2.) Pay off the mortgage - Even with a low interest mortgage, a mortgage is still a monthly bill that you HAVE to pay and it’s typically the largest bill every month. There is absolutely a piece of mind in getting rid of this. Dave Ramsey is a proponent of this - get rid of all debt as soon as possible. After the mortgage is gone, you OWN your home (well you already did, but you’re not paying a mortgage) and you really only have to worry about other bills, insurance, and property taxes.

3.) Why not both?? - There’s no reason they couldn't do both. Every bit helps. Paying down the mortgage principal is essentially shortening your mortgage because, well, you have less to pay. They could put a good chunk of this toward their mortgage AND ALSO put money toward investing and grow that money. There’s mathematically optimum and comfortable for your specific situation.

See you in the future,

Foresights Foundry

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Disclaimer: The information provided on this page is for informational purposes only and is not intended to be financial, legal, investment, or tax advice. You should consult with a relevant professional.