In the Budget Binder, I teach you to have a $1,000 emergency fund for life’s unexpected expenses. It is a given that at some point you are going to have an emergency and you are going to have to dip into that money. Maybe your husband will need emergency dental work or you will hit a deer on the way home and have to pay your deductible to get your car fixed; whatever the emergency may be, it’s going to be a lifesaver that you have the $1,000 emergency fund.
If you dip into the Emergency Fund, you need to get it back to $1,000 ASAP. Immediately reconfigure your budget worksheets in order to put all extra money towards the emergency fund to get it back to $1,000. You should pause putting extra cash towards any debt payments and instead put it back into your emergency fund until you reach $1,000. As you have already learned, having this emergency fund is vital to succeeding on your overall budget.