I know that everyone likes to harp on the $1000.00 Emergency Fund, about how it is so important to have in case, "all hell breaks lose." But what about the $500 Cushion Fund? Let's talk about that. What is the $500 Cushion Fund? Well, it's a financial rule that I have always relied upon and have learned from my mother.
She felt that she was never down and out if she had $500 in the bank. I know today this is considered old school, as the kids would say. Since today we have Roth IRA's and 401k plans. However, Mom taught me to always keep $500 in the bank and never ever EVER spend past the $500 cushion. I think it is good frugal advice that I live by to this day.
It works in 2 steps:
Never Ever, EVER Touch This Money
It is the base, the foundation, the rock on which I build my financial empire. Actually, it's like my Linus blanket. I feel more secure knowing that I have my cushion to fall back upon.
How about you?
Is your cushion ready?
Do you have your base?
Is your foundation secure?
Is your rock ready to be built upon?
She felt that she was never down and out if she had $500 in the bank. I know today this is considered old school, as the kids would say. Since today we have Roth IRA's and 401k plans. However, Mom taught me to always keep $500 in the bank and never ever EVER spend past the $500 cushion. I think it is good frugal advice that I live by to this day.
It works in 2 steps:
- $100 - For your Checking Account
- $400 - For your Savings Account
Never Ever, EVER Touch This Money
It is the base, the foundation, the rock on which I build my financial empire. Actually, it's like my Linus blanket. I feel more secure knowing that I have my cushion to fall back upon.
How about you?
Is your cushion ready?
Do you have your base?
Is your foundation secure?
Is your rock ready to be built upon?
