Monday, May 23, 2011

My Emergency Fund is Having an Emergency

My little $1000 emergency fund which has been sitting in a savings account for more than a year just took a $600 hit. I am not happy. It caused near physical pain when I had to withdraw the money from that account today. Bummer.

Right now we are living on a pretty tight budget since I am not working. A month ago, I noticed that our cell phone bill with TMobile was averaging $100 a month for not a lot of service (two lines sharing 1000 minutes a month, plus we had to pay extra for text messaging and internet). Then I noticed that TMobile now has a $30 per month pre-paid plan which includes 1500 talk and text minutes plus internet. For two phones that is only $60 per month, a much better deal than we had. I did a quick calculation and found that by discontinuing our contract cell plan we would save $40 per month. Due to the hefty $200 per line cancellation fee, it was a big $400 payment at once but the contract still had many months left and after ten months of using the prepaid plan we would then be ahead.

So I went ahead and cancelled the contract and switched to the pre-paid plan. I got the final bill today with the two cancellation fees and the last month's phone bill plus tax which ended up to be about $540. I am happy with our pre-paid plan but paying that big bill all at once made me run to my emergency fund because the income I make (about $200 a month from AdSense and website updates I do for a couple of clients) only covers my monthly bills (cells at $100, tithe at $50, and $50 spending money).

Hubby also had to reach into his emergency fund today to send his daughter $500 so both of our little emergency funds are now even smaller. We didn't want to take the money out of our travel/resettlement fund since we will be having some big airfare bills coming up in a few months as well as the possibility of first/last/deposit for an apartment at the end of the year. Hubby's monthly income (about $2000) is used for our monthly spending (food, gas occasionally, entertainment, lunch out occasionally, sundries, etc) and the rest is put aside for our annual and semi-annual bills (storage unit, car insurance, grandson's education, etc).

As it stands now...

  • I am a bit freaked out that $500, an amount I would pay for a purse or pair of shoes in my previous life, is such a big deal.

  • We need to put $600 back in my emergency fund ASAP.

  • We need to put $500 back into hubby's emergency fund ASAP.

  • I need to see how creative I can be. At this point we have nothing to sell on CraigsList or EBay for some quick cash and working at a regular job is a bit out of the question since we will be leaving in about a month.

So now I am pondering my options to make some quick cash (which should make an interesting blog post). I'll let you know what happens.


  1. Wow, what a difference in cost! It sounds like you did the right thing. Just stay focused on replenishing those accounts and you'll be good :)

  2. I wish we had more options for cell phone service here. It paid for you to switch. I'll be looking forward to your post on making quick cash.

  3. Ouch!!! Our cell is like $28 after tax with texting, etc... But my BFF pays $80'ish... Not in this lifetime would I pay that!! Lol!

  4. I'm sure you'll replenish the emergency fund in no time. It was put to good use. I have to go back and read all of your posts and catch up.

    I also have T-Mobile and did not know about this option. I will probably switch also as long I'm able to keep my current phone number.

  5. Thanks for the positive words! I am glad to see Miss Myra back (and yes, you can switch and keep your same TMo number. $30 prepaid for 1500 talk/text minutes and a limited amount of data). Carla--I think$80 is pretty average for an unlimited talk/text/data plan but $28 for talk and text??? Wow!

  6. Gosh, it's so hard to put up your own emergency fund! You have to have the right amount of discipline to be consistent with your contributions, and your reasons for building the fund should be enough to keep you motivated. Is it advisable to start small when putting up an emergency fund? And by small, I mean saving up your loose change and stuff like that. Well, that's what I'm gonna do for now.