The short-term goal
By the 1st of July, 2017 I will have $15,000 in my mortgage offset account, and $5,000 in my high interest savings.
Given that my usual annual spend sits somewhere around $40-50k, this money will act as a proper emergency fund. Despite having been on a (rather half-assed) path to Financial Independence for about two years I've never really felt the need for an emergency fund. I have a few good excuses though:
- Why have an emergency fund when I'm overpaying my mortgage and can withdraw the money without penalty?
- Why have an emergency fund when I have multiple income streams (rent, dividends and my employment)
- Why have an emergency fund when I have such low expenses?
Well all these went out the window this year when I decided to go to a private hospital for knee surgery despite not having private health insurance. I wanted my knee fixed and I wanted it now! Then I went an renovated my rental property and refinanced my mortgages at the same time, conveniently forgetting that the spare money in those mortgages was for my renos, doh! Oh and I had six weeks without a tenant, and the market sucks so the rent went down $10 a week.
So at the end of that, I'm getting an emergency fund. With $5k in my general savings I can confidently cover a couple of months of groceries or take a holiday, and the $15k in my offset account will cover six months of mortgage repayments, although since that account is responsible for bills as well it's more like three months. And that's without tightening up on expenses.
Anywho, here's where we are starting:
Anywho, here's where we are starting:
Offset Balance: $1,250.00
Savings Balance: $461.24
Total: $1,711.24
Remaining: $18,288.76, 207days
No comments:
Post a Comment