No Emergency Fund over Here

I don't have a traditional emergency fund. Heck, I don't have an emergency fund full stop. Though I like to think of my National Savings & Investment bonds as my emergency fund, it isn't because I class it as an investment in my finance spreadsheets.

Definition of an Emergency Fund.
Money you can realise in a short space of time to help you get over difficulties. The figure varies based on personal preference and circumstance. A lot of PF bloggers advocate at least 3 months' worth of essential expenses.The money should be easily accessible – for a lot of people, this means some kind of account without withdrawal notice.

Why Don't I Have an Emergency Fund?
Simply because I don't feel I need one at this time. Let me explain:
I am single with no dependents. I live alone. I am gainfully employed, I have no debt, I have health insurance and I have at two relatives within 100 miles of where I live who would put me up for a minimum of 3 months, with food, no questions asked and no contributions sought. Whatever the emergency, I'm sure I could whack it on a credit card / the overdraft and manage to find the money before the payment became due in a month. I would sell some assets (car, nice television etc.) and if necessary, cash my bonds in. I feel my money would serve me better invested in the stock market at this point. My family, my investments and my possessions are my emergency fund.

That Seems Reckless.
It may sound it – based on what everyone says and on different personal circumstances. The clincher for me is having family that are able to and more than happy to provide those basic physiological needs – food, shelter and water. Apart from those, there isn’t much else I will be requiring and, if there was, the burden on my fund would be greatly aided by the family looking out for necessities.

What if your Family Members' Circumstances Changed?
As I said, I have two family members who would take me in for a minimum of 3 months. Even if their circumstances changed, I am assured a minimum of 3 months to get myself together. In addition, I also have many friends who would let me crash at theirs, on average for a fortnight – I should know because I've housed and fed a few of them whilst they were going through difficult times - that is what we do for each other. I'm not putting my faith in them though – I am only citing blood relatives as my emergency fund.


This is my emergency fund for now though I fully expect my circumstances to change. Who knows? I might get a pet, and decide I can't descend on my family with my pet tortoise Gregory in tow. I prefer to invest in my future and deal with any surprises life throws my way as and when they crop up. The higher my Solvency Ratio, the better I will be at mobilizing funds if and when disaster strikes, so I choose to work on that for now.