Financial Wisdom Matters More Than Financial Timing

**SPEAKER_1** (0:05)
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**George Kamel** (0:14)
Normal is broke and common sense is weird. So we're here to help you transform your life. From the Ramsey Network and the Fairwinds Credit Union Studio, this is The Ramsey Show. I'm George Kamel here with Dr. John Delony. We're taking your calls at 888-825-5225.
You call us up, we'll try to help you take the right next step for your money and your life. Hannah kicks us off in Orlando, Florida. What's going on, Hannah?

**SPEAKER_3** (0:41)
Hi.
So we are, me and my husband, we are currently on baby step number two. We're completely debt free aside from our mortgage, so we are trying to get our three to six months savings built up, so that way we can move on to the other baby steps. My question is, when we are setting up our emergency savings, our three to six months, what should we include in that? So I am a stay at home mom, but I also own my own business, so I work part time and then I have my health insurance that we pay for privately. Should I include the health insurance expense as part of that, since it is something that it is really expensive for both me and my daughter. So we're just trying to figure out what we should include in our emergency savings plan itself.

**George Kamel** (1:31)
Yeah, and it sounds like you guys are wanting to lean towards six months versus the three. That's sort of the spectrum that we have. And if you do have, you know, if there's single income or variable income or there's health issues in the family, then you want to lean towards six. You'd rather be safe than sorry and not have enough to cover the gap. So six months is the goal. How much money is that?

**SPEAKER_3** (1:52)
Between like mortgage, like our HOA, car insurance, health insurance and groceries, it probably would be, I would estimate probably about 15 to 17,000 for six months for us. And that's not including health insurance. Our health insurance for me and my daughter is about 600 a month, so it's pretty expensive, unfortunately.

**George Kamel** (2:19)
Okay, so let's add that in. So 600 a month, six months worth. Let's add another four grand for that.
So now we're at basically 20 grand would get you guys by for six months to cover all of your basic needs. We can strip out the luxuries. We don't need every single thing in there. If you did have a legitimate storm or a job loss, we're not gonna live how we were living before.

**SPEAKER_3** (2:43)
Yeah.

**George Kamel** (2:44)
Okay, so 20K is the goal. You guys have the $1,000 starter emergency fund right now, and now you're working towards the 20?

**SPEAKER_3** (2:51)
Yes, we currently have almost 12 grand in savings. And that's including like pretty much everything liquidated that we have in terms of savings, including the $1,000 baby starter.

**George Kamel** (3:04)
Wow, so you guys are only 8,000 away.

**SPEAKER_3** (3:07)
Yeah, we're pretty close. We've been pretty fortunate with just childcare and everything like that. We haven't had to pay for much childcare aside from like family friends just paying for gas and stuff like that. So we've been pretty blessed, actually.

**John Delony** (3:22)
Well, and also y'all have made some choices. So you have been blessed, you are privileged, you are fortunate, all those things are true. And you're choosing to do things a little bit differently, right?

**SPEAKER_3** (3:33)
Yeah.

**John Delony** (3:33)
And so own, yes, we're fortunate and we've been lucky in some areas and also we're working really hard. I like to, George, tell me if this is bananas. I emergency fund for me, philosophically is if I walked in here and Dave Ramsey said, you're fired, get out, that me and my wife would be able to eat and take care of our bills for the next six months. But practically speaking, it was not this past week, it was the week before.
In one day, I got up early before work. I took one of my family's vehicles and I have a 16 year old, so there's three drivers. I took one vehicle to one automotive shop. I took another vehicle to another automotive shop. I got dropped off at work. While I was at work, I got a call from the air conditioner guy that my central unit had to be replaced, like had to be taken off, and my wife called and said, the well's broken out in the country, so we have no water in the house. All that was on one day.