Tuesday, November 10, 2009

How I Funded My Emergency Fund

A few months back I got totally serious about getting out of debt. I had been listening to Dave Ramsey for maybe six months by then but still felt that there was no way I could even begin to get my baby emergency fund together let alone go without using a credit card for a month. How was I supposed to put $1000 aside? The only time my bank account sees that much money is the day after payday--a couple of days later it is always back to double digits as I use the money to pay my bills. Then I got irked at a credit card company.
I used their credit card but not often and had a really low balance on it but for some reason I started getting more than a dozen calls A DAY from them saying that I was behind in my payment by a week or so. I wasn't behind in my payments with them though. I thought they had made a mistake and would figure it out but after three days of continuous calls (literally dozens a day from a computer) I called them and asked what the heck was going on. The lady checked my account, said she didn't know why it was happening, and said the calls would stop.

That weekend we were having a garage sale so I used some of the proceeds to pay off the bill online. I then called back on Monday and told them to cancel my credit card. When she asked why, I told her if that (meaning the onslaught of computer calls) was how they treated their customers I wanted no part of giving my business to their company. She apologized but by then I was pretty irked so I insisted that she cancel the card. The feeling of having power over a credit card company--something that had never happened IN MY LIFE--was like your first hit of crack (I'm guessing...I've never used crack but it seems fitting what with the blissful high people talk about but that's a different blog...). Anyway, after that call I was psyched. I didn't feel like I had lost anything but rather gained something indescribable...like a mix of power, pride, and control.

So my next step was to fund my small emergency fund with $1,000, then as quickly as possible pay off my last remaining credit card, figuring that instead of needing my credit card for a crisis I would actually have CASH to cover the things I would usually use my credit card for. So the ways that I both paid off the last credit card and funded my emergency fund at the same time included a mix of:
  • Garage sales. We usually had one a year but this year had two. The first garnered about $500 and the second brought in around $200. I found that huge signs on the busy roads around our house coupled with ads on our local Craigslist brought people out of the woodwork...the road in front of our house looked like downtown LA at rush hour.

  • Craiglist. I love Craigslist. Hubby was worried that murderers stalked the Craigslist site what with all of the bad publicity that came about after some high profile assaults and murders related to the site some time ago, but we have found nothing but wonderful people who have answered our ads. And we had plenty of ads. Everything that would bring more money via Craigslist than at a garage sale was advertised--basketball hoop, patio furniture, bikes, etc. all got sold.

  • eBay. I usually sell small, higher value items on eBay such as cell phones, digital cameras, etc. We sold a couple of things this way which added to our emergency fund.

  • Sold gold. One day driving down the street I heard a radio ad about selling your gold. I always heard that these places were a rip off but the idea of making money from the clump of broken gold chains and bracelets that had been collecting dust for over a decade was appealing. I called a local jeweler who had been in the community for ages and had a good reputation and found out that they bought gold. I immediately collected up all of my broken and unwanted gold things and brought them to the jeweler where he cut me a check for over $700! I hadn't seen or used that jewelery for literally more than ten years so it wasn't like I missed it when it was gone.

So there you have it. Almost $2,000 earned within a couple of months that went to start an emergency fund and pay off my last credit card. When you are pissed off and totally intense, miracles can actually happen. Best of all, I used to use my credit card when I ran out of money justifying that I would pay off the balance the next month. With my emergency fund, I don't have that attitude. My feeling is that the $1,000 I have in my emergency fund is ALL that I have in case of an emergency. I would no more want to spend that money, even a little of it, even if I could repay it next month, than pull my eyes out. You don't have that same emotional feeling with a credit card.

1 comment:

  1. This is so great! I just had my first garage sale this week. I'm moving to a minimalist lifestyle, so I don't see myself having another one.