Why Saving For An Emergency Fund Brings Financial Freedom

0:00Have you ever had one of those times where everything seems to break at once? The AC stops working, the fridge leaks, and all you can think is, how are we supposed to afford this? But what if, instead of panic, you felt inconvenienced but not worried, knowing it's covered? In today's episode, I'm flipping the script on emergency funds and helping you see how building one isn't about missing out on fun. It's about creating freedom, security, and peace with living. Welcome to the Wealthy After 40 podcast, the show for Gen X women and couples who are ready to ditch financial stress and feel confident about retirement.

0:45I'm your host, Dailene Higgins, financial and retirement coach, helping Gen Xers master their money and create a personalized retirement plan so they can stop spinning their wheels and step boldly into their dream retirement. If you're feeling behind, don't worry. Continue listening to this podcast as well as be sure to grab your free guide, 5 Must Do Steps to Start Retirement Planning Now at elevatefinances.us backslash must do. And remember, let's make retirement possible together. there.

1:22Welcome to the episode, Emergency Funds. Not a fun subject, but I hope with this episode, I can help you understand why an emergency fund should make you feel wealthy and secure instead of missing out on fun. So one afternoon, I was in the salon. It was a new salon to me as if you've been listening for a while, you knew I, you know, moved. A new salon, a new hairdresser. While getting to know her, she shared about how her air conditioner was on the fritz. And this was July, hottest part of summer. And she says, how are we supposed to afford this? We both just had car repairs. And now this. She was stressed, not sure what to do.

2:08And her husband was actually leaving for military leave the next day. Since I was new, I did have the ability to share with her a wonderful HVAC repairman. Luckily, I had that. So left it at that, figured he would help her, and he doesn't charge an arm and a leg. I felt really good. So a little bit later, same visit, a former salon worker came in and was visiting, and she says, I had a pipe in my basement burst this morning. Ah, she shares about we're scrambling her and her husband, blah, blah, blah. So I'm listening in to the chatter amongst others that had kind of, you know, congregated and talking about this situation as they were friends and co-workers.

2:50And the biggest question that stuck out to me, or I guess the biggest challenge they were facing was how are we supposed to afford all these things. Now I'm looking at three hardworking women struggling to be prepared for these types of emergencies. It's, you know, emergencies are going to happen. We have to just get that in our mind. And while it's not fun to spend your money on emergencies, we'd rather be spending it somewhere else, it's so essential that you learn to prioritize your emergency fund. Now, that is easier said than done. It's a struggle, you know, to set aside$200, $500, whatever amount of money, just in case something happens.

3:48It's this, well, I'm going to set it over here, but I don't know what's going to happen. And, you know, it's really ambiguous at that point. And in today's world, there is so much living for the now. Social media showing us what others are doing and enjoying, you know, trips they're taking, all of those things. That same social media sharing ads with us for the things we love to purchase. So as we're looking at this and seeing this, we're like feeling bad because why don't I get that if they have that? And you kind of glance over to your emergency fund. Well, if I just use that, right? And this cycle can be never ending and a very difficult one to break, you know, if you've been in this for a long time.

4:41Now, there are times, and this is the biggest thing, there are times you need to dip into that emergency fund. That may not be big and stout and all of that. But having that pot of savings isn't just that. It isn't just a pot of savings. It is a fund that will support you in similar circumstances to the stories I was hearing at the salon. Learning to view it as something more than just a bucket of savings will help you in your efforts to contribute to it and let it sit. I want to throw this real quick in there. Hopefully as you contribute to it and let it sit, it is in a high yield savings account, right where it's growing.

5:30It's growing and adding some more to it just to reward your efforts. Why should you create an emergency fund? Well, it is necessary for many reasons. I'm going to share with you two. The first one is to make sure that you can cover an emergency expense without increasing the price of that expense by having to get a loan, put it on a credit card or whatever. That just increases the price, but it also can delay the process in getting your repair or your replacement. You have to go through those steps to get through that thing and find those results to then get you the money to then proceed with the repair instead of just jumping in and think, I've got the money, you can do this.

6:22Number two, it's to give us peace of mind in these situations, in these similar situations. And like I said in the very beginning, it does feel like an emergency fund is, well, I've got the money just in case. And I believe this is one of the hardest things to save for. It is probably one of the most crucial. But once you've mastered this, the ability to save for anything gets easier. What do you need to do? You need to make the why of your emergency very tangible. you've got to bring it into reality of the way you think, the way you feel with what you worry. If you are somebody who is continually dipping into your emergency fund, you know, for splurges, for those last minute vacations or whatever it is, I want you to craft you a story.

7:25Now, I shared stories from the salon visit. I want you to craft your own futuristic story. Okay, well, if I had X amount of money in my emergency fund to cover the roof that I know is going to need to be replaced, hopefully before it leaks, all of these things, this is what I mean by crafting you a story. I want you to get real with what is your biggest worry? What is your biggest concern with if an emergency were to happen today? And I want you to craft that story of this would feel really good in a horrible situation to have this money. And then you, yes, we're inconvenienced by the emergency, but having that money makes things less stressful.

8:16I want to share another story. This one was about my dad. He needed a heart surgery. This was many years ago. And, you know, okay, we're going to go in, do bypass. he'll spend two days in the ICU and about three to four days in regular care. I'm like, okay, great. My dad ended up spending six days in ICU because of complications. But I was grateful. And I was in a situation where I knew I didn't have to worry about my parents financially. I got to worry about my dad, his health, my mom as her caregiver, as his caregiver and, you know, doing all the things. I got to worry about them. I got to worry about my loved ones instead of worrying about how they were going to pay for it on the flip side.

9:04Now, this episode really comes at a time I prepared it before and now recording it. My husband had a heart attack a couple of days ago. I'm prepared to pay the cost. We have the ambulance bill coming. We have the ER bill coming. We have the cath lab surgery coming. We have the ICU stay. Granted, he didn't spend six days, but we know hospital expenses grow, and I am prepared to cover the deductible and then everything after that. But I don't have to stress about, oh, in double weight. I get to worry about my husband, and hopefully he's going to be okay and get the care he needs and, you know, be able to rehab back to what he was.

9:53This is what I want for all of my clients and for you listeners as well. Not to experience the emergencies, but they are going to happen. But to be, you know, a little bit stress-free because the money is not an issue anymore. That how are we going to pay for that? I'm not sure how this is going to work out. You know, if it's jobless due to a health condition, whatever it is, it can be anything. I really want you to be in a situation that no matter what happens, that stress of how I'm going to pay for it is gone. That the inconvenience, some of those lower emergencies or those greater emergencies that you're like, well, I can just do what I need to do.

10:38I was working with clients who out of Florida and one of the big hurricanes had just gone through. They were luckily missed, but they realized the importance that they needed to have a deductible for the hurricane. What if the hurricane would not have missed their house? They didn't quite have their$12 ,000 deductible. and if you have that ready you can quickly get on the phone and start making plans to get the repairs done instead of oh how are we going to pay for it what's the best way i'll have to go talk to the credit union or these loan people or my parents or whatever it is we cut out this step and we move right into resolve mode it's an inconvenience especially with a hurricane you know, those types of things, you're able to just move forward and putting yourself, you know, kind of in a Debbie Downer doomsday type of thing, not so much, but I want you to craft that story so that you can, you can fill and understand that, okay, this would be an inconvenience and this would not be fun.

11:50But if I could just turn the money over to somebody and not have to about how I'm going to get that, life would be so much better. I've shared several different stories, real life moments, where an emergency fund wasn't just about having the money. It was about having peace. And if you're listening and realize you've been caught in a similar cycle, where every unexpected expense, that's what emergencies are, send you into stress mode. It's time to get ahead of it. If you want similar results like my clients, inside the Retirement Roadmap session, I help you create a budget with noted savings that can start funding your emergency fund.

12:38Within that session, you'll see clearly where your money is going, how it aligns with your savings priorities and what needs to shift so you could start saving without feeling deprived. It's all about finding that balance of now and later. This is the first step to building a system that keeps you from dipping into your emergency fund for fun, those last minute vacations, but you'll have the money for those vacations as well. Because having a plan doesn't limit your freedom. It actually creates it. If you're ready to stop wondering how you'll afford that next emergency and you want to start finding peace and comfort as that balance grows, your first step is to book a Clarity Connection call at elevatefinances.us backslash connection.

13:33Jump on that call. Let's chat about what potential challenges you are facing and how those can be resolved with just a few steps. To recap the action step that you can take today, going back and listening to this episode if you need, but I need you to define your story of how it would be different if you had your emergency fund fully funded to cover the biggest worry that you have right now, your biggest stress. Lean into the feeling of it being different, of it being prepared. Yes, that emergency is still going to happen, but what if the money was there? And it helps you shift that thought about what you could be doing with the money now and just leaving you prepared.

14:23Again, make sure your emergency funds are sitting in a high yield savings account, that they are, you know, as you continue to contribute to that, they are rewarding you for that. And that fund will grow and support you and give you peace and comfort if you are to have your AC go out, a pipe burst, or a medical emergency. We just don't know what is coming and when, but being prepared will help alleviate a lot of the stress. Thank you for tuning into this episode and I will see you next.

15:01Thank you for spending this time with me. If you're not already following the show, be sure to hit subscribe so you don't miss what's coming next. And I'd love to stay connected with you between episodes. So come join me inside my Facebook community, Retirement Ready Hub for GenXers. It's where we're having real conversations about money, sharing wins, working through challenges, and building a clear path toward retirement. And remember, retirement isn't just a dream it's a plan and you get to make it possible