Why Do Emergencies Keep Wiping Out My Savings?

Speaker A00:00:00

Have you been working hard to save money? And then you find yourself at the automobile shop, the hood's up, the mechanics explaining the cost. You're not shocked anymore.You're just tired of it. You work so hard to build that savings and now it's gone again.If you're exhausted from a building the same savings over and over, today's going to be about breaking that cycle. Hey, friend. Ralph Estep Jr. Here. This is financially confident Christian.We work to break that cycle of financial shame and help you really live in confidence. And today's topic is why those emergencies keep wiping out your savings. Let's get into today's listener question.Ralph Every time I manage to save a little money, something comes up and I have to drain it again. Car repair, medical bill, whatever. It's always something. I am so tired of this cycle.I feel like I'll never get ahead because I'm constantly starting over from zero. Ralph how do I actually protect my savings and stop these emergencies from destroying all my progress?First of all, thank you for sharing your question. If you've got a question for this show, go to financiallyconfidentchristian.com/question.And I'd love to answer your question, but today's big idea is this. And this is going to sting a little bit, so get ready. If this happens regularly, it's not an emergency. It's just not. It's a category.But let's get to fixing this today. Which leads me to the first thing you've got to explain to yourself. You got to redefine what emergency really means. I've heard this so many times.I've heard it from my wife, I heard it from my children. I've heard it from other people. We had an emergency. Well, what is an emergency? Is it car repairs? Is it those medical co pays, home maintenance?Those aren't rare disasters. Those aren't emergencies. Those are predictable. Maybe they're irregular, but. But they are predictable.An emergency is a job loss you weren't expecting. An emergency is a major medical crisis. You weren't expecting a true disruption to your system.And see, when you label everything emergency, your savings never stands a chance because everything's an emergency. So how do you break that? Number one thing you've got to do is you've got to separate your savings into layers.So many people have their savings account, their emergency fund, just one big pile and it feels good because you're, oh, I've got this great pile. I've got this savings feels great till it disappears, right? So instead of that create some layers.Start off with an emergency fund, what I call a true crisis only fund. I mean this is the thing that. This isn't about repairs and maintenance. This is the emergency. This is all hands on deck. We got a problem.But then maybe you need a car repair fund. Maybe you've got a jalopy that's on its last leg and this thing is at the mechanic shop all the time.That's not an emergency, that's an issue that needs to be accounted for. Create that car repair fund. Maybe you need that medical fund. Listen, when my kids were young, I knew we were going to be going to the doctor.There was going to be co pays, there was going to be medical, was going to be medicines in that. Again, those are not emergencies. Build that medical fund. And if you're a homeowner like most of us, guess what?Your house is going to need maintenance. It's part of being a homeowner. So build that home maintenance fund. Again, those are not emergencies.And even small amounts put into those separate buckets protect that core savings. This is what I fancily call financial compartmentalization. But it works. And once you do that, calculate the annual reality.See, this isn't about emergencies. Go back and add up what you actually spent last year on those car repairs. Get into the details, tires, maintenance, all those type of things.Build those into that fund so you know how much you need to set aside. Do the same thing with your medical stuff. Again, those are non emergencies. If you go to the doctor, build that in.How much did you spend last year on out of pocket expenses? Start to budget that. Take an honest look at your house. What did you fix? What needs fixing? Those aren't emergencies.And those annual subscriptions, this one cracks me up all the time. I had this emergency rev this subscription renewed and I'd forgotten about it. That again is not an emergency.Figure those out, divide the number by 12 and then start to fund that. See, that number isn't unexpected at that point it's your monthly preparation and planning for that predictable expense stops that reset cycle.Another thing you've got to do. You've got to protect that real emergency fund with rules. There is a place for a true emergency fund. Because things happen. Emergencies do happen.But you got to have a rule for this. I love this rule. Somebody sent this in to me. They said, ralph, we only touch this for income interruption or true crisis.And when you do, use it, because guess what? Things happen in life. Don't feel defeated at that very moment. Create a rebuilding plan.Maybe it's only 25 bucks a week, but start that momentum again because that's going to matter more than what your speed is at the going back to get into it. And here's a big takeaway thing. Mindset change here. Stop calling it rebuilding, starting over. You're not sailing, you're. You're not starting over.Hear me on this. You're using your savings for what it was built for. This is, was the intention of it from the beginning. Savings is doing its job.That's what protected you from having to run up that credit card or going barring for somebody else. This isn't a time for defeat. This is actually stewardship. And if you have that emergency fund, the goal isn't to never use it.I pray that you don't have those emergencies, but the goal is to use it wisely and rebuild it intentionally. My big takeaway for today, I want you to be prepared, but not panicked. Prepared, not panicked. So here's your big win for today.Just a single step that you can take today. I want you to look at one emergency from the past year. Your list might change.Now, after listening to this, you're like, wait a minute, Rob, that probably wasn't an emergency. And ask yourself this, was this truly unexpected or was it just unplanned? I think what you're going to find is it really wasn't unexpected.It just wasn't planned.Step two of that is to create that we call them fancy name sinking fund category this week to start building that fund, whether it's your car or your house or those medicals. And listen, just carve out $10 a week or $10 a pay and start to build that fund. It's not an emergency. It's intentionality.Let's get to our Bible verse today comes to us from the book of Ecclesiastes, chapter 11, verse 2. Invest in seven ventures. Yes, in eight. For you do not know what disaster may come on the land. I like to use that one when I talk about emergencies.Because scripture reminds us that why stewardship, really, why stewardship includes preparing for what we know will eventually come. We know these things are going to come. If you've got a car, it's going to break down sometimes.If you've got a house, it's going to require maintenance. And if you've got kids or yourself, you're going to get sick. Sometimes you got to plan for those things. How about we pray right now?Father God, you see how discouraging this cycle feels for us? You see that frustration of rebuilding again and again.So Lord, right now I ask that you would give my friend wisdom to prepare and I'm not talking about fear but really foresight into preparing and help them separate what is truly a crisis from what is simply a part of life and at the same time strengthen their discipline. Lord, protect their true emergency fund and give them patience as they build those layers of stability.Remind them that using savings wisely is not a failure at all. It's faithfulness. And we ask this in Jesus name. Amen friend. You're not stuck, you're not failing. Actually learning to prepare smarter.And if you've got a question for this show, how about sending it to me? You can go to financiallyconfidentchristian.com/question we'll put that in the show notes but I want to give it to you again right now.It's financiallyconfidentchristian.com/question thank you so much for joining me today. I encourage you to stay financially savvy. May God bless you and you have a great day today.