When we started our debt repayment with gazelle intensity, we just wanted to be debt free, like yesterday. We just wanted to be free of the shackles of debt, so we didn’t lay the proper ground work. I knew I should put money in an emergency fund first, and I knew our family of 5 needed more set aside than the $1,000 Dave Ramsey recommends because I am self-employed and my income varies. Still, every time we had extra money, I couldn’t throw it on our debt fast enough.
That, my friends, was a mistake.
While we had some very tight months a time or two, we managed to get by without a large enough emergency fund, until the last two months when several expenses hit us such as my medical expenses and my husband’s pay being docked by $700 for two months.
We couldn’t bounce back from those unplanned expenses, and we had no security net in the form of an emergency fund, so we went back into debt.
I can’t tell you how much I hate losing ground on our debt repayment plan.
After next month, my husband’s paycheck should be back to normal, and after one more test in November, I think my medical issues will settle down. We will be able to start making progress again.
And yes, I still want the debt gone, but I have learned the importance of an emergency fund. If it takes us the next two, three, four months to fully fund an emergency fund to at least $3,000 (ideally $5,000), that is what we will do. Debt repayment will take a back seat until the emergency fund is in place because I never want to go in debt again.
If you would like some help starting or growing your emergency fund, check out this giveaway: