The Ugly Truth About Unexpected Expenses

When it comes to handling unexpected expenses—the old appliance that finally goes kaput, the big car repair, the emergency visit to the dentist—most people are unprepared.

In fact, a recent article that I read in a respected business journal reported one poll where more than 75 percent of Americans said they would be unprepared for an unexpected $400 expense. The same article said most of these people would charge the expense on a credit card and pay it off—or not—with interest over time.

In other words, they would have to go into debt (or more debt) to finance the unexpected $400 bill. Ugh. Still, it shocks me that three-quarters of those polled would be badly shaken by a $400 expense.

Not to minimize the personal finance challenges many people face, and clearly there have been times in my life when a blown out carburetor sent me into a financial tailspin. But $400, if you save your $5 bills, can be accumulated in a relatively short period of time. Even if you only save $20 a week in $5s (I typically save between $35-$60/week), you’d have $1049 saved in a year, or enough saved to face two and a half of those $400 emergencies a year.

Just saying. Happy Monday, everyone!

Yours in Fives,

Marie

           

 

 

 

 

 

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