> EVERYONE should have min 3 months of income in savings.
It surprises me how few do though. I do. Six months or more in fact. I'm in a relatively well-paid job (senior-developer-come-local-database-export) as of course are many of the people around me, in fact some should be much better off, but there are those among them who get edgy if a mistake makes our pay late by a day because they have bills payments going out soon - they have little or no cushion or emergency fund.
The grads I can understand: they are young, they have debts from student lives that they are paying off, and even if those factors are not true/significant they aren't paid as well (they will be, we promote them fairly quickly if they show the relevant aptitude & attitude, but not yet) and they've not been working as long so haven't had the same chance to build up an emergency fund.
But people who have been working for years and have partners who have decently paid jobs too? I doubt they are paying much into a pension either. In a couple of decades they are going to have a nasty "surprise"...
Of course non of this would make a monthly paycheck or two being completely delayed a worrying experience. Even people successfully following the standard 3-month+ advice would be feeling insecure at that point.
I have coworkers like that too, guys who've been working for much longer than me (and getting paid more), without savings. We're not working at a minimum wage job, how do they even manage to spend all of that? Do they not plan on retiring one day? You can't possibly work till the day you die
Oh, that part is easy. I could spend everything I have and more very quickly. It takes a little forethought and willpower (and perhaps paranoia about the future) not too!
In no first world country should you be afraid that your child will die because you can't pay your electric bill because you're not getting paid for a job you're forced to work.
> A Kentucky family whose main source of income was lost because of the partial government shutdown worries they will soon loose the ability to care for their 15-month-old daughter who needs special equipment to stay alive.
Honest question: I still don't understand how the "federal workers must work during furlough" thing doesn't violate the 13th Amendment. What's the story there?
It’s not that they literally must work. It’s that they can be fired for not showing up despite going without pay. Any private employer could also try this, although it’s questionable whether or how long people would put up with it. When the government is the employer, there’s some level of confidence that at least you’ll get paid in the future, whereas with a private employer once they stop paying on time they usually are going to continue to have trouble making payroll until they fold.
Typically people do not go to work while living on their emergency fund. That is why it doesn't sit well when we tell the government employees that they should be living off their hard-earned savings while they work for us for free. It's not an emergency, it's madness.
To some extent, people work for the government because of the stability. You are not going to wake up one morning to find that the United States Government is out of business, so an emergency fund seems less essential than if you were working at a startup with 3 employees.
With government work no longer being considered more stable or reliable than the private sector, the one advantage that the government has used to recruit workers and pay them less than average is gone. That means government work is going to go un-done, or they're going to have to start paying employees more to make up for the risk. That only hurts us taxpayers.
I agree about the ridiculousness of the cause of the temporary income loss. It's still an emergency for the individual/family and therefore an instance for which the emergency fund exists.
Preferably, actual emergencies, not manufactured ones. Property damage/maintenance, healthcare, travel to visit family in an emergency, money to cover expenses if evacuated due to a natural disaster, I can think of more. Certainly job loss fits into this but federal workers are not losing their jobs at this point; it's an untenable situation.
Depending on how big your company is, you might need already one month saving alone for any hickup on payment.
I'm not assuming that i will lose that money.
But yes in general if i have emergency money, its out of scope and it doesn't 'hurt' directly when i actuall have to lose it. Thats the point of it. But still when i lose it, i have to replace it later right?
Yes. They should have savings. EVERYONE should have min 3 months of income in savings. No one should be expected to use it.