WEBVTT NOTE This file was generated by Descript 00:00:04.935 --> 00:00:07.125 Introduction: Welcome to the Fiscal Firehouse, a podcast 00:00:07.125 --> 00:00:09.975 dedicated to promoting financial literacy to firefighters. 00:00:10.125 --> 00:00:14.715 I'm your co-host, John Beatty, executive board member of Local 1309, a lieutenant, 00:00:14.805 --> 00:00:16.845 and also a certified financial planner. 00:00:17.175 --> 00:00:21.735 With me, I have the other co-host of the fiscal firehouse, Louis Barella, executive 00:00:21.735 --> 00:00:25.845 Board member of Local 1309 ambulance driver, and want to be financial expert. 00:00:26.445 --> 00:00:29.505 Together, John and I hope to bring clarity to the world of personal finance, 00:00:29.535 --> 00:00:31.275 specifically relating to firefighters. 00:00:31.815 --> 00:00:34.275 Firefighting is a difficult job making sound. 00:00:34.275 --> 00:00:35.640 Financial decisions shouldn't be. 00:00:36.195 --> 00:00:38.235 Introduction EF: In today's episode of the fiscal firehouse, John and 00:00:38.235 --> 00:00:39.915 Louie discuss emergency funds. 00:00:40.125 --> 00:00:40.755 What are they? 00:00:41.205 --> 00:00:42.705 What constitutes an emergency? 00:00:43.080 --> 00:00:45.090 How do I fund an emergency fund? 00:00:45.270 --> 00:00:48.180 And lastly, what's the best account for an emergency fund? 00:00:48.750 --> 00:00:51.900 Don't let the lack of an emergency fund be your financial mayday. 00:00:52.440 --> 00:00:56.220 Without further ado, let's kick it over to local 1309 studios and the 00:00:56.220 --> 00:00:57.715 recording of the fiscal firehouse. 00:00:59.190 --> 00:01:01.380 Jon: Welcome back to the Fiscal Firehouse. 00:01:01.770 --> 00:01:03.090 I'm your co-host John Beatty. 00:01:03.150 --> 00:01:04.680 I sound a little bit under the weather. 00:01:04.800 --> 00:01:05.730 I apologize. 00:01:05.790 --> 00:01:09.060 I'm fighting something, but, this is something that's not gonna stop. 00:01:09.060 --> 00:01:09.690 We're gonna continue. 00:01:09.690 --> 00:01:13.110 We guaranteed one episode a month and we're gonna keep producing. 00:01:13.110 --> 00:01:16.050 So we're delivering That's right on the mic. 00:01:16.100 --> 00:01:16.850 as always. 00:01:17.175 --> 00:01:21.435 the fan favorite Louis Barilla in his Michigan blue, as always 00:01:21.585 --> 00:01:23.355 represent, are they playing today? 00:01:23.445 --> 00:01:24.495 Louie: They're number one seed, 00:01:24.495 --> 00:01:25.305 Jon: number one seed. 00:01:25.305 --> 00:01:25.995 Do they play today or 00:01:26.055 --> 00:01:26.715 Louie: playing today. 00:01:26.775 --> 00:01:27.075 Yeah. 00:01:27.385 --> 00:01:28.885 Jon: who's the big opponent? 00:01:28.935 --> 00:01:31.035 Louie: our first opponent will be decided. 00:01:31.110 --> 00:01:31.770 Today. 00:01:31.845 --> 00:01:32.115 Jon: Oh. 00:01:32.115 --> 00:01:33.105 So they don't even know yet. 00:01:33.195 --> 00:01:33.795 Oh, okay. 00:01:33.960 --> 00:01:35.460 Louie: do the playing, so Yeah, 00:01:35.525 --> 00:01:38.045 Jon: know my badgers are facing the, high point. 00:01:38.105 --> 00:01:39.815 Dude, I don't even know what mascot they are. 00:01:39.915 --> 00:01:41.025 at noon today. 00:01:41.175 --> 00:01:41.385 Okay. 00:01:41.415 --> 00:01:42.705 So we'll see their 12 seed. 00:01:42.705 --> 00:01:45.315 12 five is always like a bracket buster. 00:01:45.315 --> 00:01:45.345 Oh, 00:01:45.970 --> 00:01:46.060 Louie: yeah. 00:01:46.060 --> 00:01:46.960 That's always a fun one. 00:01:47.025 --> 00:01:48.555 I filled down my bracket and I'm a homer. 00:01:48.555 --> 00:01:49.365 I'm going Michigan. 00:01:49.365 --> 00:01:49.815 I'm riding. 00:01:49.815 --> 00:01:49.995 Let's 00:01:50.030 --> 00:01:51.200 Jon: you get, well, 00:01:51.255 --> 00:01:51.735 Louie: year 00:01:51.915 --> 00:01:52.755 Jon: Do you think so? 00:01:52.815 --> 00:01:53.445 Okay. 00:01:53.450 --> 00:01:54.015 I do. 00:01:54.015 --> 00:01:55.335 they didn't bring it in the Big 10 00:01:55.630 --> 00:01:56.130 Louie: That's good. 00:01:56.150 --> 00:01:56.650 That's good. 00:01:56.785 --> 00:01:58.315 'cause then that has some motivation there. 00:01:58.345 --> 00:02:01.855 Like you struggle at the Big 10 tournament and then the coach gets 00:02:01.855 --> 00:02:04.975 on you and motivates you, tells you like this is your future if 00:02:04.975 --> 00:02:06.445 you don't get your shit straight. 00:02:06.475 --> 00:02:06.805 So 00:02:06.855 --> 00:02:09.165 Jon: guys do something that threes for a bracket or are you 00:02:09.165 --> 00:02:11.445 just doing like the generic ESPN? 00:02:11.445 --> 00:02:11.595 We have 00:02:11.665 --> 00:02:16.555 Louie: a, we do a dual bracket, so you can submit two entries and then we have this. 00:02:16.815 --> 00:02:21.435 Complex payout that Reed came up with in terms of who gets paid like winner 00:02:21.435 --> 00:02:26.185 gets some, we get, we have a, an award for the worst bracket as well. 00:02:26.185 --> 00:02:29.305 So if you have the fewest points scored, you can get some cash there too. 00:02:29.485 --> 00:02:30.295 So it's 00:02:30.370 --> 00:02:31.300 Jon: So it's a win-win. 00:02:31.510 --> 00:02:34.465 I mean, you either really ratted high or just auger it in. 00:02:34.465 --> 00:02:34.485 Auger it 00:02:34.495 --> 00:02:35.185 Louie: Augered in. 00:02:35.230 --> 00:02:38.230 Jon: So do you find that you guys, is there someone that like really picks 00:02:38.230 --> 00:02:39.610 a bunch of crap just so they try to 00:02:39.625 --> 00:02:40.940 Louie: get, I think someone did that last year. 00:02:40.960 --> 00:02:42.490 Jon: year and they didn't end up losing, 00:02:42.640 --> 00:02:45.420 Louie: they didn't lose, they were just like media, the, this guy who 00:02:45.420 --> 00:02:49.200 was trying the hardest, I think got the worst bracket last year. 00:02:49.200 --> 00:02:50.790 So we'll see, man. 00:02:50.800 --> 00:02:53.770 Jon: There's a lot of studies that show exactly that. 00:02:53.770 --> 00:02:58.330 you know, the infamous one is people that pick, pick the team based on mascots and 00:02:58.330 --> 00:03:00.430 like what mascot is like the coolest one. 00:03:00.430 --> 00:03:04.095 And they've done better than Diehard, like analytical people that know 00:03:04.095 --> 00:03:08.625 injuries, rosters, you know, who's all the other things and all the inside 00:03:08.625 --> 00:03:10.305 info and they still can't beat it. 00:03:10.305 --> 00:03:10.365 Yeah. 00:03:10.990 --> 00:03:11.270 Speaking about 00:03:11.330 --> 00:03:11.960 Louie: it's a crap shoot. 00:03:12.470 --> 00:03:13.485 Jon: speaking about can't beat it. 00:03:13.485 --> 00:03:15.635 There's, have you seen what Calci is doing? 00:03:16.025 --> 00:03:18.455 So Calci is one of the prediction markets. 00:03:18.455 --> 00:03:21.425 So them in poly market are like the two big ones where you 00:03:21.425 --> 00:03:22.835 can basically bet on anything. 00:03:22.865 --> 00:03:23.045 it's 00:03:23.140 --> 00:03:23.320 Louie: yeah. 00:03:23.735 --> 00:03:27.815 Jon: degens are us, you know, so if you wanna bet on it, I mean long, 00:03:27.845 --> 00:03:29.885 as long as there's someone that'll take the other side, they'll. 00:03:29.910 --> 00:03:31.650 They'll throw up some cash and some wagers. 00:03:31.950 --> 00:03:37.840 $1 billion if you call out a perfect bracket, when we went back and did the 00:03:37.840 --> 00:03:43.665 lottery episode, we talked about math and the chances, I think it was one and 9.1 00:03:43.665 --> 00:03:45.435 or two Quinn trillion, 00:03:46.095 --> 00:03:46.485 Um, 00:03:46.585 --> 00:03:47.365 Louie: never pay it out. 00:03:47.425 --> 00:03:47.995 Basically, 00:03:48.045 --> 00:03:50.955 Jon: they said it was the same odds of winning the Powerball. 00:03:51.045 --> 00:03:53.350 31 times what of 00:03:53.375 --> 00:03:54.005 Louie: getting a perfect 00:03:54.285 --> 00:03:55.665 Jon: Of getting a perfect bracket. 00:03:55.905 --> 00:03:59.445 That's why once again, these companies would never offer that kind of thing if 00:03:59.445 --> 00:04:01.485 they thought it was actually achievable. 00:04:01.585 --> 00:04:05.815 that'd be an interesting factoid to see who's actually had gone the furthest, like 00:04:05.815 --> 00:04:08.875 with the perfect bracket, has it gone all the way down to the championship game? 00:04:08.875 --> 00:04:09.505 Has it made it to 00:04:09.590 --> 00:04:09.860 Louie: final. 00:04:09.860 --> 00:04:10.460 No. 00:04:10.705 --> 00:04:10.975 Jon: eight? 00:04:10.975 --> 00:04:11.875 Like any of that stuff? 00:04:11.875 --> 00:04:12.265 I don't know. 00:04:12.885 --> 00:04:12.945 I 00:04:12.950 --> 00:04:15.950 Louie: I think I heard one point someone got to the Sweet 16 with a 00:04:15.950 --> 00:04:17.630 perfect bracket, but I could be wrong. 00:04:17.630 --> 00:04:18.980 I thought someone at one point 00:04:19.125 --> 00:04:19.760 Jon: the sweet 16. 00:04:19.760 --> 00:04:19.920 Yeah. 00:04:19.920 --> 00:04:20.280 It's normally 00:04:20.300 --> 00:04:21.740 Louie: it was year, it was years ago. 00:04:21.765 --> 00:04:22.155 Jon: Yeah. 00:04:22.185 --> 00:04:23.715 It's normally always the first round, right? 00:04:23.715 --> 00:04:26.925 Thursday and Friday there's someone that just, you know, 16 falls to a one 00:04:26.925 --> 00:04:29.235 or a one falls to a 16 or whatever. 00:04:29.235 --> 00:04:32.565 Like I said, the five twelves always a hot pick for upsets and 00:04:32.645 --> 00:04:33.575 Louie: And eight nine's a crap 00:04:33.685 --> 00:04:35.415 Jon: eight, nine, and literally coin toss. 00:04:35.470 --> 00:04:36.280 On the odds. 00:04:36.335 --> 00:04:37.565 Louie: I think more nines win than eight. 00:04:37.565 --> 00:04:38.735 It seems like a lot of years. 00:04:38.800 --> 00:04:40.090 Jon: that's what I picked this go around. 00:04:40.090 --> 00:04:41.530 So it's always fun. 00:04:41.530 --> 00:04:42.880 it keeps people entertained. 00:04:42.960 --> 00:04:43.350 Louie: It's great. 00:04:43.500 --> 00:04:43.510 Jon: great. 00:04:43.530 --> 00:04:45.210 I also have the fun factoid. 00:04:45.210 --> 00:04:46.260 Don't you know what this is? 00:04:46.260 --> 00:04:49.980 What I love about our job so much is all the useless information that 00:04:49.980 --> 00:04:55.120 I've gained around this circular table in the kitchen is, this is 00:04:55.120 --> 00:04:56.710 the number one week for urologists. 00:04:57.040 --> 00:04:58.330 Do you know why? 00:04:58.330 --> 00:04:58.390 No, 00:04:58.650 --> 00:05:02.520 Louie: people get their vasectomy and then they sit and watch basketball. 00:05:02.770 --> 00:05:04.060 Jon: You can't make this up, dude. 00:05:04.240 --> 00:05:07.390 You can't, dude, this is the Super Bowl for the urologist. 00:05:07.690 --> 00:05:07.870 Oh my God. 00:05:07.940 --> 00:05:10.880 so all our urologist friends out there that are hopefully 00:05:10.880 --> 00:05:12.580 listening, you know, here's to you, 00:05:13.215 --> 00:05:14.355 Louie: that's, I'm doing it next year 00:05:14.480 --> 00:05:16.820 Jon: and there might be more people signed up after listening 00:05:16.820 --> 00:05:20.630 to last month's episode of the kids that might be on board for this. 00:05:20.635 --> 00:05:21.175 Louie: like, you know what? 00:05:21.175 --> 00:05:22.345 I don't wanna deal with that headache. 00:05:22.345 --> 00:05:24.085 I'm just gonna go get snipped and then I 00:05:24.995 --> 00:05:25.625 Jon: don't have time 00:05:25.735 --> 00:05:26.365 Louie: Sit and watch 00:05:26.465 --> 00:05:28.655 Jon: of which, man, I got some really good feedback. 00:05:28.685 --> 00:05:28.895 Yeah, I do too. 00:05:28.895 --> 00:05:30.995 From last month's episode. 00:05:30.995 --> 00:05:31.055 Yeah. 00:05:31.105 --> 00:05:34.555 a lot of different people thought it was, useful for one, but like things that 00:05:34.555 --> 00:05:36.125 they hadn't considered and other things. 00:05:36.125 --> 00:05:38.705 kudos to, Benny for kind of giving us that. 00:05:38.705 --> 00:05:40.625 Um, softball, that softball up there. 00:05:40.625 --> 00:05:42.965 I just wasn't on my radar, so keep 'em coming, man. 00:05:42.965 --> 00:05:45.805 If there's more things that will resonate with you guys, we're all about it. 00:05:45.870 --> 00:05:46.320 Louie: Love it. 00:05:46.380 --> 00:05:48.995 Speaking of, you know, firehouse, you're talking about cool facts and stuff. 00:05:49.055 --> 00:05:50.355 We have a tradition at threes. 00:05:50.460 --> 00:05:52.410 I don't think I've talked about this yet, but it's pretty cool. 00:05:53.400 --> 00:05:53.410 We, 00:05:53.515 --> 00:05:54.115 Jon: I'm scared 00:05:54.420 --> 00:05:56.370 Louie: have a no Google. 00:05:57.045 --> 00:05:58.665 Rule on day one. 00:05:58.695 --> 00:06:03.435 So we can't settle debates with everyone pulling out their phone and searching 00:06:03.465 --> 00:06:05.865 chat GPT or the Googles for the answer 00:06:05.880 --> 00:06:06.600 Jon: to, okay, 00:06:06.615 --> 00:06:10.215 Louie: So if we don't know the answer to something and we're not sure what the. 00:06:10.925 --> 00:06:13.145 What the right answer to whatever topic is. 00:06:13.535 --> 00:06:18.575 We have to just debate it like men used to in the firehouse before they 00:06:18.620 --> 00:06:20.150 Jon: like the founding fathers had to get up on 00:06:20.155 --> 00:06:20.875 Louie: It's the best 00:06:20.975 --> 00:06:22.775 Jon: on the dice and speak your argument. 00:06:22.945 --> 00:06:27.060 Louie: The best arguer is wins the debate and we're like, oh, maybe he's right. 00:06:27.060 --> 00:06:28.830 And then we find out later that he's full of shit and he 00:06:28.830 --> 00:06:29.640 didn't know what he was talking 00:06:29.875 --> 00:06:31.465 Jon: But you know what, that's a lost art, I think. 00:06:31.465 --> 00:06:35.295 I think the art of being able to converse and disagree or make 00:06:35.295 --> 00:06:37.545 your point because it's so easy to be like, dude, you're wrong. 00:06:37.545 --> 00:06:38.295 So you look at this. 00:06:38.325 --> 00:06:38.565 Exactly. 00:06:38.565 --> 00:06:39.045 Look at this thing. 00:06:39.045 --> 00:06:39.405 You're wrong. 00:06:39.405 --> 00:06:39.495 You're 00:06:39.545 --> 00:06:39.695 Louie: Yeah. 00:06:39.695 --> 00:06:40.985 And that takes away the fun out of it. 00:06:40.985 --> 00:06:42.575 Like now let's just argue and debate. 00:06:42.575 --> 00:06:46.535 So we'll debate all these topics on day one, and then we have a whiteboard 00:06:46.535 --> 00:06:51.260 in the kitchen and we write down the topic that we were all arguing about 00:06:51.260 --> 00:06:53.195 and debating about throughout the day. 00:06:53.435 --> 00:06:53.495 Yeah. 00:06:53.495 --> 00:06:56.825 And then on the morning of day two, we all wake up, you know, everyone 00:06:56.825 --> 00:06:57.725 goes, has their coffee, sits around. 00:06:58.235 --> 00:07:02.375 At the kitchen table and then we pull out the Google machines and start figuring out 00:07:02.375 --> 00:07:03.875 who was right, like you were full of shit. 00:07:03.875 --> 00:07:07.685 You convinced me that this answer was right and you had no idea 00:07:07.745 --> 00:07:08.795 what you were talking about. 00:07:08.795 --> 00:07:09.965 And people are like, yeah, I didn't know. 00:07:09.965 --> 00:07:10.835 I thought that was 00:07:10.860 --> 00:07:14.400 Jon: But I, yeah, I was really convinced, like I thought I knew and I didn't. 00:07:14.500 --> 00:07:14.770 Louie: fun. 00:07:14.770 --> 00:07:15.340 It's a fun 00:07:15.440 --> 00:07:18.710 Jon: I actually think there should be, that should be instituted more often. 00:07:18.950 --> 00:07:19.250 Yeah. 00:07:19.340 --> 00:07:22.820 You know, I love that thought of that exercise of like actually having 00:07:22.820 --> 00:07:24.380 to make an argument, stand by it. 00:07:24.860 --> 00:07:26.840 Debate it and then sit on it. 00:07:26.955 --> 00:07:27.245 Yeah. 00:07:27.250 --> 00:07:29.960 And then, you know, 24 hours later you can figure out whether or 00:07:29.960 --> 00:07:31.070 not you're really right or wrong. 00:07:31.070 --> 00:07:32.390 And that's besides the point at that point. 00:07:32.420 --> 00:07:35.240 'cause half the fun is in the argument aspect of it. 00:07:35.290 --> 00:07:38.920 And getting people spooled up and really just on edge. 00:07:38.980 --> 00:07:40.090 man, I think that's a great rule. 00:07:40.090 --> 00:07:42.910 So maybe a challenge to the other stations out there listening. 00:07:42.960 --> 00:07:45.090 Louie: our engineer Josh Peterson is a good arguer. 00:07:45.120 --> 00:07:48.660 So there's a lot of guys at the station, not me, Josh, but a lot of guys at 00:07:48.660 --> 00:07:50.190 the station want him to be wrong. 00:07:50.190 --> 00:07:50.280 Sure. 00:07:50.710 --> 00:07:53.680 so they're like, you know, as long as Josh is wrong, that's all that matters to me. 00:07:53.755 --> 00:07:56.935 Jon: Everyone knows someone at the station that's got a talent 00:07:57.040 --> 00:07:59.170 a gift for being able to argue. 00:07:59.470 --> 00:07:59.530 Yeah. 00:07:59.530 --> 00:08:01.090 You can name 'em, we can rattle 'em off. 00:08:01.090 --> 00:08:02.740 So yeah, here's to you. 00:08:02.890 --> 00:08:04.540 Yeah, all the arguers out there. 00:08:04.735 --> 00:08:06.175 Louie: the Josh Petersons of the world. 00:08:06.700 --> 00:08:07.360 Jon: That's great. 00:08:07.750 --> 00:08:08.470 That's great. 00:08:08.500 --> 00:08:09.580 what are we gonna get into today? 00:08:09.880 --> 00:08:11.620 Lb, what should we, what should we chat on? 00:08:11.665 --> 00:08:15.385 Louie: this is a fun one because, you know, we work with a bunch of dudes 00:08:15.385 --> 00:08:18.505 who like to run into burning buildings every opportunity that they get. 00:08:18.895 --> 00:08:22.565 And so we like to be part of emergencies. 00:08:22.565 --> 00:08:29.285 We respond to emergency funds, but how many of these dudes have emergency funds? 00:08:29.345 --> 00:08:29.525 My 00:08:29.725 --> 00:08:30.385 Jon: Oh, I like that. 00:08:30.385 --> 00:08:31.615 Play on words there. 00:08:31.615 --> 00:08:32.305 Look at you. 00:08:32.500 --> 00:08:33.520 Louie: guess is very few. 00:08:33.520 --> 00:08:37.450 So today we are gonna talk about the emergency fund. 00:08:37.670 --> 00:08:38.060 Jon: Yeah. 00:08:38.060 --> 00:08:41.660 And this is one that I think, you know, anecdotally and just talking 00:08:41.660 --> 00:08:46.130 with people, obviously we are sought out a lot on our department for advice 00:08:46.130 --> 00:08:47.660 or guidance on a lot of these things. 00:08:47.910 --> 00:08:50.370 and this is one that I think gets overshadowed quite a bit. 00:08:50.370 --> 00:08:53.220 Like people don't even really have this on their radar or something like. 00:08:53.280 --> 00:08:54.420 Should be in place? 00:08:54.420 --> 00:08:56.340 Or like how much or what does this look like? 00:08:56.700 --> 00:08:59.610 You know, I think they just have a savings account with some money in it, and I 00:08:59.610 --> 00:09:03.120 think they just think that's satisfactory and like that box has been checked 00:09:03.330 --> 00:09:04.500 and then they move on with their life. 00:09:04.500 --> 00:09:08.630 They don't really think about what is the purpose of an emergency fund? 00:09:08.630 --> 00:09:09.560 Why would you even have it? 00:09:09.560 --> 00:09:12.530 Why is that different than just having money in a savings 00:09:12.530 --> 00:09:13.880 account or a checking account? 00:09:13.955 --> 00:09:15.455 Louie: I never get asked that question. 00:09:15.455 --> 00:09:19.925 Like the only question I get asked, and I get asked fairly often about, one topic 00:09:19.925 --> 00:09:23.815 with emergency funds, and that's always, Hey, how do I get some money on this? 00:09:23.815 --> 00:09:24.955 How do I earn some money? 00:09:24.955 --> 00:09:25.915 Where can I keep it? 00:09:25.915 --> 00:09:30.215 I do get those questions, but really not about The methodology, like 00:09:30.215 --> 00:09:31.625 how do I save an emergency fund? 00:09:31.625 --> 00:09:32.555 How do I build it? 00:09:32.855 --> 00:09:33.845 Why do I need it? 00:09:33.845 --> 00:09:36.305 What can I, what should I spend an emergency fund on? 00:09:36.305 --> 00:09:36.365 Yeah. 00:09:36.875 --> 00:09:40.805 So I think it might be nice to just have a quick conversation about emergency 00:09:40.805 --> 00:09:44.225 fund, and especially because in the United States there's like a, it's 00:09:44.225 --> 00:09:47.315 hard for Americans to save a dedicated. 00:09:47.770 --> 00:09:52.630 Reserve fund that is only used for emergencies and the 00:09:52.630 --> 00:09:53.890 statistics bear that out. 00:09:53.890 --> 00:09:58.090 So John, one kind of interesting statistic that I saw, or a couple I guess, is 00:09:58.090 --> 00:10:03.050 that according to the Federal Reserve, only 63% of Americans can cover a $400. 00:10:03.470 --> 00:10:05.300 Emergency using cash. 00:10:05.405 --> 00:10:05.435 Jon: Okay? 00:10:05.780 --> 00:10:05.810 Louie: Okay. 00:10:05.900 --> 00:10:08.780 So a lot of times people will go, I'll just use a credit 00:10:08.780 --> 00:10:10.220 card as my emergency fund. 00:10:10.220 --> 00:10:10.310 Sure. 00:10:10.340 --> 00:10:12.320 I got a $10,000 credit limit. 00:10:12.620 --> 00:10:13.850 I'll just use that bad boy. 00:10:13.850 --> 00:10:13.910 Yeah. 00:10:14.270 --> 00:10:16.310 Which can lead to a slew of problems. 00:10:16.700 --> 00:10:19.010 And let's be real, $400 is an emergency. 00:10:19.010 --> 00:10:19.610 It's not a lot. 00:10:19.610 --> 00:10:21.200 that's not a huge emergency. 00:10:21.200 --> 00:10:23.720 In some ways that's like a very modest emergency. 00:10:24.160 --> 00:10:29.060 and, bank rate did a survey that showed about 60% of Americans can't cover. 00:10:29.435 --> 00:10:32.105 A $1,000 emergency using cash. 00:10:32.105 --> 00:10:36.465 So that's, you know, almost two thirds of Americans don't have the ability 00:10:36.585 --> 00:10:38.685 to cover a thousand dollars emergency, 00:10:38.850 --> 00:10:42.270 Jon: which once again, to your point, is not a lot of money to go 00:10:42.270 --> 00:10:45.510 around when you think of all the things that can consider what you'd 00:10:45.510 --> 00:10:47.400 want to use an emergency fund for. 00:10:47.700 --> 00:10:51.210 You know, a thousand dollars is a pretty low barrier as far as you 00:10:51.210 --> 00:10:53.970 know, what an emergency would actually cost in a lot of different context 00:10:53.970 --> 00:10:57.800 is whether that's medical or homes or autos and all those other things. 00:10:57.800 --> 00:10:58.700 So that's interesting. 00:10:58.700 --> 00:10:59.960 I'd be really curious to see what. 00:11:00.365 --> 00:11:03.515 The firefighters would look like, and as opposed to this, I feel like we would 00:11:03.515 --> 00:11:06.665 be able to maybe cover a little bit more than this, but maybe I'm optimistic. 00:11:06.665 --> 00:11:06.995 I don't know. 00:11:06.995 --> 00:11:09.835 Maybe we fall right in line with the general population 00:11:09.955 --> 00:11:11.005 when it comes to being able 00:11:11.045 --> 00:11:11.585 Louie: know either. 00:11:11.585 --> 00:11:14.680 My gut was telling me, eh, we, we probably can't cover. 00:11:14.765 --> 00:11:15.875 Jon: cover that. 00:11:15.875 --> 00:11:15.885 we 00:11:15.910 --> 00:11:20.080 Louie: We're probably at least in line with it, but I don't know, man. 00:11:20.080 --> 00:11:23.540 it's, for risk taking individuals, which firefighters tend to 00:11:23.540 --> 00:11:25.010 be, I can see them going. 00:11:25.100 --> 00:11:26.570 I don't know if there's an emergency. 00:11:26.660 --> 00:11:27.710 I'll figure it out later. 00:11:28.365 --> 00:11:31.815 Jon: And I also see with this is, you know, so the flip side 00:11:31.815 --> 00:11:34.245 of that, we talked about how many people could or couldn't cover it. 00:11:34.605 --> 00:11:38.855 You also have that, 21% of Americans have no savings at all. 00:11:38.870 --> 00:11:41.510 Louie: One in five Americans have no emergency 00:11:41.750 --> 00:11:43.985 Jon: so you can't even cover, you know, 30 bucks. 00:11:43.985 --> 00:11:44.045 Yeah. 00:11:44.135 --> 00:11:46.055 Or whatever you're always digging. 00:11:46.335 --> 00:11:51.955 and then 25% or a quarter of those folks, o of Americans had to dip into emergency 00:11:51.955 --> 00:11:54.265 funds to cover basic living expenses. 00:11:54.265 --> 00:11:54.565 Yeah. 00:11:54.670 --> 00:11:55.750 Louie: and that's over the last year. 00:11:55.750 --> 00:11:59.980 So over the last year, about a quarter of Americans had a dip into their fund 00:11:59.980 --> 00:12:02.680 to cover some kind of emergency expense. 00:12:02.890 --> 00:12:02.920 Okay. 00:12:02.980 --> 00:12:03.580 Which is a lot. 00:12:03.580 --> 00:12:05.920 I think that shows like you probably need it in any given year. 00:12:05.920 --> 00:12:10.000 If you have a 25% chance of having a dip into your fund, that means 00:12:10.000 --> 00:12:10.900 you probably should have something. 00:12:10.900 --> 00:12:11.230 Sure. 00:12:11.440 --> 00:12:13.030 Jon: Yeah, no, I definitely get that. 00:12:13.090 --> 00:12:17.000 So I guess, you know, maybe we start with, the definition kind. 00:12:17.000 --> 00:12:20.030 It's always good to start with a defining of what we're actually talking about. 00:12:20.030 --> 00:12:24.710 'cause once again, I think this is a topic that is at the edges is always 00:12:24.710 --> 00:12:28.520 talked about in kind of a, an aloof way or an ambiguous way in which 00:12:28.520 --> 00:12:31.610 people just I've got some money in savings, or I have a credit card so if 00:12:31.610 --> 00:12:33.120 something comes up I can pay for it. 00:12:33.120 --> 00:12:34.410 It's not like I have to go without. 00:12:34.830 --> 00:12:37.770 But we really wanna talk about what is the essence of an 00:12:37.770 --> 00:12:38.160 Louie: emergency. 00:12:38.280 --> 00:12:38.400 Mm-hmm. 00:12:38.670 --> 00:12:40.170 Jon: Why do you want to have one? 00:12:40.480 --> 00:12:42.130 and then what are some of those ways to fund it? 00:12:42.130 --> 00:12:46.780 So an emergency fund is a dedicated cash reserve that is set aside 00:12:46.780 --> 00:12:50.500 specifically for unexpected expenses. 00:12:50.740 --> 00:12:51.070 All right? 00:12:51.070 --> 00:12:54.820 So a couple keywords with that is, first of all, it's dedicated, all right? 00:12:54.820 --> 00:12:57.790 So you have a separate account, you have a separate bucket, something else 00:12:57.790 --> 00:13:01.600 like this that is earmarked, ef, or whatever you want to call it, right? 00:13:01.600 --> 00:13:03.185 Whatever your pet name for that. 00:13:03.520 --> 00:13:05.410 Fund is, but that's its sole purpose. 00:13:05.510 --> 00:13:08.845 Louie: and it's, you know, you mentioned dedicated, but it's also a cash reserve. 00:13:08.845 --> 00:13:12.025 So we are not gonna consider your ability to draw on your credit 00:13:12.025 --> 00:13:13.465 lines as an emergency fund. 00:13:13.525 --> 00:13:17.725 We're saying cash reserves something in cash or cash equivalence 00:13:17.995 --> 00:13:19.375 is what an emergency fund is. 00:13:19.495 --> 00:13:22.585 Jon: That's good because I think a lot of times those things get convoluted. 00:13:22.585 --> 00:13:25.945 So yeah, you want to have the money set aside and we'll talk about where you can 00:13:25.945 --> 00:13:31.315 set that money aside, but not relying on revolving credit or credit access in order 00:13:31.315 --> 00:13:33.355 to pay for these unexpected expenses. 00:13:33.435 --> 00:13:37.545 Super important, small detail, but a very important, so what could it include? 00:13:37.545 --> 00:13:40.095 Once again, it says unexpected expenses. 00:13:40.395 --> 00:13:42.795 So thinking about things with your vehicle, you know, you 00:13:42.795 --> 00:13:43.905 have a transmission that gets. 00:13:43.940 --> 00:13:47.030 Blown out and you need a new transmission or anything with that. 00:13:47.060 --> 00:13:49.520 Most of the time those things happen unexpectedly. 00:13:49.790 --> 00:13:50.450 Home repairs. 00:13:50.450 --> 00:13:50.780 Dude, 00:13:50.925 --> 00:13:51.045 Louie: one. 00:13:51.100 --> 00:13:51.440 Oh yeah. 00:13:51.445 --> 00:13:52.075 this is it, right? 00:13:52.075 --> 00:13:52.105 This is it. 00:13:52.460 --> 00:13:53.210 Home repairs. 00:13:53.210 --> 00:13:56.700 if your, furnace goes out in the winter, you're, probably this 00:13:56.700 --> 00:13:57.960 year in Colorado you'd be fine, 00:13:58.115 --> 00:13:58.415 Jon: be fine. 00:13:58.625 --> 00:13:58.805 Yeah. 00:13:58.805 --> 00:14:02.975 When your AC blows up because it's, 85 degrees outside and it's March. 00:14:02.980 --> 00:14:03.190 Yeah. 00:14:03.305 --> 00:14:03.605 Yeah. 00:14:03.605 --> 00:14:05.315 This is a, that's an emergency man. 00:14:05.405 --> 00:14:07.835 You got, you're married, you got little kids, dude. 00:14:07.835 --> 00:14:09.215 they ain't handling a high heat. 00:14:09.270 --> 00:14:09.630 Louie: no. 00:14:09.630 --> 00:14:13.170 you gotta have your home repairs in order and sometimes that means 00:14:13.620 --> 00:14:17.790 dipping into your emergency fund to cover those kind of home expenses. 00:14:18.320 --> 00:14:21.020 wife wants a new kitchen, that's not an emergency fund. 00:14:21.170 --> 00:14:25.250 I think as important as what is considered an emergency is what's 00:14:25.250 --> 00:14:26.600 not considered an emergency. 00:14:26.600 --> 00:14:29.630 So emergencies are home repairs. 00:14:30.425 --> 00:14:31.175 Vehicle repairs. 00:14:31.175 --> 00:14:32.045 'cause you gotta get to work. 00:14:32.045 --> 00:14:32.465 We get it. 00:14:32.465 --> 00:14:34.025 You gotta have reliable transportation. 00:14:34.425 --> 00:14:35.175 medical bills, 00:14:35.220 --> 00:14:35.610 Jon: Yeah. 00:14:35.610 --> 00:14:36.420 Think about that. 00:14:36.420 --> 00:14:37.170 Medical bills. 00:14:37.170 --> 00:14:39.900 So once again, you would think, and most people listening to this, right? 00:14:39.960 --> 00:14:42.810 a lot of our members and, you know, the fire service in general, 00:14:42.810 --> 00:14:44.175 whether you're working for a district or you mean to set up. 00:14:44.480 --> 00:14:46.760 Municipality have pretty good insurance, right? 00:14:46.760 --> 00:14:46.820 Yeah. 00:14:46.820 --> 00:14:48.070 So you're thinking about man, really. 00:14:48.070 --> 00:14:52.340 But one of the things that I don't think gets talked about enough is, people that 00:14:52.340 --> 00:14:56.090 are on high deductible health plans, you know, where you can be shelling out a 00:14:56.090 --> 00:14:58.760 couple grand before you hit that minimum. 00:14:58.810 --> 00:15:01.990 so everything that you're incurring in those costs is all coming 00:15:01.990 --> 00:15:03.370 out as a deductible right away. 00:15:03.370 --> 00:15:07.630 So it's definitely really possible that you can have good health insurance, right? 00:15:07.930 --> 00:15:09.700 What's considered good health insurance, but you're on like 00:15:09.700 --> 00:15:11.350 a high deductible health plan. 00:15:12.185 --> 00:15:16.205 You know, especially for a family dude, it can be in the thousands of dollars that, 00:15:16.205 --> 00:15:19.185 that you're gonna be shelling out before you're even meeting your deductible. 00:15:19.185 --> 00:15:23.045 I don't think this is beyond the scope of what, you know, the membership and 00:15:23.045 --> 00:15:25.085 firefighters in general would experience. 00:15:25.115 --> 00:15:25.175 Yeah. 00:15:25.580 --> 00:15:29.600 Louie: And then, you know, also equally important is if you lose a job, whether 00:15:29.600 --> 00:15:32.300 you're a firefighter or not, if you are outta work and you lose your job, 00:15:32.570 --> 00:15:34.850 your living expenses is an emergency. 00:15:34.850 --> 00:15:37.370 Food is absolutely an emergency. 00:15:37.370 --> 00:15:39.200 That's like the old school emergency, right? 00:15:39.200 --> 00:15:41.630 Is you gotta put food on the table for you, for your family. 00:15:42.020 --> 00:15:45.110 So you could dip into your emergency fund if you are out of a job and 00:15:45.110 --> 00:15:46.880 you can't cover those basic needs. 00:15:46.985 --> 00:15:47.255 Jon: Yep. 00:15:47.255 --> 00:15:51.045 And I think that's something that, once again, for most of us, like this job is 00:15:51.045 --> 00:15:54.585 secure for the most part in the sense of you're probably not gonna get laid off. 00:15:54.585 --> 00:15:55.395 You never say never. 00:15:55.395 --> 00:15:56.685 I'm knocking on wood right now. 00:15:57.115 --> 00:16:00.385 but there are circumstances where you get injured, you know, and once again, 00:16:00.385 --> 00:16:04.605 we have a very, Really good modified duty policy here at our organization, 00:16:04.605 --> 00:16:07.065 but there's a lot of places where you either have to go into short-term 00:16:07.065 --> 00:16:09.735 disability or something else, and there's always that offset in the 00:16:09.735 --> 00:16:10.935 amount of money that you're bringing in. 00:16:10.935 --> 00:16:13.995 So there's a lot of different ways that you can really carve this thing 00:16:13.995 --> 00:16:15.980 up that are completely applicable to a. 00:16:16.290 --> 00:16:17.490 To firefighters. 00:16:17.490 --> 00:16:20.370 So it not just has to be about, you know, your spouse or your loved 00:16:20.370 --> 00:16:23.395 one that's got a regular corporate job or something that like that. 00:16:23.395 --> 00:16:27.535 that might be more susceptible to job loss, but, it can definitely happen as 00:16:27.535 --> 00:16:31.105 a firefighter, not in that you lose your job, but some of that income is gone 00:16:31.105 --> 00:16:33.825 away because you get sick or injured and you have to make up for that. 00:16:33.825 --> 00:16:35.745 So not lost on us at that. 00:16:35.745 --> 00:16:36.765 That affects everyone. 00:16:36.780 --> 00:16:37.020 Louie: Yep. 00:16:37.080 --> 00:16:37.380 Yep. 00:16:37.620 --> 00:16:40.950 And now let's ruffle some feathers and talk about what are not emergencies. 00:16:40.950 --> 00:16:41.370 All right. 00:16:41.370 --> 00:16:44.070 Even though a lot of firefighters will probably tell you this is an 00:16:44.070 --> 00:16:47.590 emergency for me, I need that side by side, the trailer and the side 00:16:47.590 --> 00:16:53.570 by side that you need to buy so that you can, justify your $70,000 truck. 00:16:53.750 --> 00:16:54.860 That's not an emergency. 00:16:54.860 --> 00:16:55.790 You don't need that this year. 00:16:55.820 --> 00:16:57.080 I know you think you do, but you don't. 00:16:57.225 --> 00:16:57.575 Uhhuh, 00:16:57.835 --> 00:16:59.515 Jon: you talked about vacations, 00:16:59.535 --> 00:17:00.345 Louie: Vacation, family 00:17:00.625 --> 00:17:04.345 Jon: this one's hard 'cause I feel like it's a need, like for mental health 00:17:04.345 --> 00:17:07.135 and all these other things, in the whole scheme of things, you know, back 00:17:07.135 --> 00:17:10.555 to what the purpose of this is and if it's the difference between paying 00:17:10.555 --> 00:17:14.425 your rent or paying your mortgage or putting food on the table or. 00:17:14.750 --> 00:17:16.280 Getting a needed procedure. 00:17:16.280 --> 00:17:19.040 Like I think we can all take a step back and be like, okay, I get it. 00:17:19.040 --> 00:17:23.360 there's other things that are bigger than just this I want versus I need, 00:17:23.360 --> 00:17:24.710 and that's really what it comes down to. 00:17:24.710 --> 00:17:27.830 Is this something that you want or is this something that you need? 00:17:28.160 --> 00:17:32.030 And so many of those things are just their, they seem like their needs. 00:17:32.035 --> 00:17:32.875 Louie: And I get it. 00:17:32.990 --> 00:17:35.570 you don't need a $10,000 Disney vacation. 00:17:35.630 --> 00:17:39.640 You don't, I, you might think it's so necessary for your mental health. 00:17:40.040 --> 00:17:42.800 there are humans that have existed for thousands of years 00:17:42.800 --> 00:17:43.970 that have not had a vacation. 00:17:43.970 --> 00:17:44.330 All right. 00:17:44.420 --> 00:17:44.600 Jon: Yeah. 00:17:44.600 --> 00:17:46.250 You tell that to my 6-year-old. 00:17:46.250 --> 00:17:50.000 All right, Louie, you're gonna come over and tell little Easty look that. 00:17:50.000 --> 00:17:53.450 Sorry, uncle Louie says, this is not a 00:17:53.655 --> 00:17:53.895 Louie: a no go. 00:17:54.260 --> 00:17:55.250 Jon: This is a want. 00:17:55.310 --> 00:17:56.250 And, sorry. 00:17:56.250 --> 00:17:58.170 We're just gonna have to, we're gonna have to wait on that. 00:17:58.185 --> 00:17:58.695 Louie: I get it. 00:17:58.695 --> 00:18:00.135 It's hard, but that's how it is. 00:18:00.595 --> 00:18:04.045 and on a related note is, any kind of shortfall in your budget, whether it's 00:18:04.045 --> 00:18:09.915 a vacation shortfall, a vacation budget shortfall, or a nice to have, you know, 00:18:09.945 --> 00:18:12.765 dining out kind of budget category. 00:18:13.095 --> 00:18:15.945 Just because you don't have enough to cover those doesn't mean you should dip 00:18:15.945 --> 00:18:17.835 into your emergency fund to make your. 00:18:17.920 --> 00:18:21.190 Budget hole that generally requires cutting or moving money around 00:18:21.190 --> 00:18:23.560 somewhere else, but we don't think you should dip into your emergency 00:18:23.560 --> 00:18:27.280 fund willy-nilly just because you've been overspending in certain areas. 00:18:27.280 --> 00:18:30.490 That's a lack of discipline, probably not a good practice to get into. 00:18:30.490 --> 00:18:33.130 And if you start developing that kind of little cheat, that little habit, 00:18:33.550 --> 00:18:36.190 you're eventually gonna blow through any kind of hard work that you've 00:18:36.190 --> 00:18:37.810 done to accumulate an emergency fund. 00:18:37.920 --> 00:18:39.730 Jon: You, beat me to the punch on that one. 00:18:39.730 --> 00:18:40.390 I think it is. 00:18:40.390 --> 00:18:43.760 Once again, Louis and I have said so much about what, so much of what we 00:18:43.760 --> 00:18:47.840 talk about is creating good habits and behaviors associated with those habits. 00:18:47.840 --> 00:18:49.730 And this is a slippery slope. 00:18:49.820 --> 00:18:51.500 'cause you go in there for just one thing. 00:18:51.755 --> 00:18:54.455 And then all of a sudden it ends up being something and every time you're 00:18:54.455 --> 00:18:57.605 justifying, because maybe at some point you're working overtime or something 00:18:57.605 --> 00:18:59.645 else like that and you replenish it so you're like, you're fine. 00:18:59.645 --> 00:18:59.705 Yeah. 00:19:00.005 --> 00:19:03.095 But it's just going to the well so many times where it's just gonna create 00:19:03.575 --> 00:19:08.285 that cognitive habit where it's just gonna become so normal that you do it. 00:19:08.285 --> 00:19:10.535 And that's one of the things I think, you know, when you think 00:19:10.535 --> 00:19:11.915 about the emergency fund is. 00:19:12.145 --> 00:19:15.325 Really should not be that normal where you're having to go into these things now. 00:19:15.325 --> 00:19:15.985 Get it dude. 00:19:15.985 --> 00:19:16.705 Life happens. 00:19:16.885 --> 00:19:18.145 Some people are cursed. 00:19:18.265 --> 00:19:21.505 You know, some things is just dude, it's just a shit sandwich and you're 00:19:21.505 --> 00:19:24.865 just, there's a lot of things come in for a lot of different angles. 00:19:24.865 --> 00:19:29.455 if you extrapolate that out over a longer period of time, the frequency in which 00:19:29.455 --> 00:19:31.105 that happens should be less and less. 00:19:31.405 --> 00:19:34.885 So it shouldn't be something that you're having to dive into a lot, 00:19:35.035 --> 00:19:36.655 hopefully, unless you're cursed. 00:19:36.655 --> 00:19:39.385 And we talked about why are emergencies. 00:19:39.945 --> 00:19:41.535 Emergency funds important. 00:19:42.345 --> 00:19:44.895 So life happens Murphy's Law. 00:19:45.225 --> 00:19:45.735 All right. 00:19:45.785 --> 00:19:47.195 it's a nice little safety net. 00:19:47.435 --> 00:19:50.675 So I would actually, as we're talking about this, I would've loved to see, 00:19:51.005 --> 00:19:55.115 you know, and so much of this is, because of the access of credit in our. 00:19:55.720 --> 00:19:56.440 Society. 00:19:56.490 --> 00:19:58.770 Whether that's through home equity loans, whether that's through 00:19:58.770 --> 00:20:01.470 credit cards, whether that's through personal loans from the bank. 00:20:01.890 --> 00:20:05.160 You know, this was really a necessity before credit existed. 00:20:05.400 --> 00:20:07.170 Like you had to have an emergency fund. 00:20:07.170 --> 00:20:12.030 There was no other IOU or I have to borrow, you know, whatever from whoever. 00:20:12.240 --> 00:20:15.900 So now just the ease of which credit is accessible, I think as. 00:20:15.945 --> 00:20:19.155 Made us maybe a little bit lazy when it comes to thinking about 00:20:19.155 --> 00:20:22.005 having an emergency fund, because now you know, like I said, everyone 00:20:22.005 --> 00:20:23.295 just puts it on the credit card. 00:20:23.355 --> 00:20:23.415 Yeah. 00:20:23.505 --> 00:20:26.775 Or they have some other mechanism to fund these things and it doesn't 00:20:26.775 --> 00:20:28.665 really create that necessary. 00:20:28.755 --> 00:20:28.815 Yeah. 00:20:28.845 --> 00:20:31.605 Hey, I've got a whole separate account because I don't have access to this, 00:20:31.755 --> 00:20:35.145 Louie: and I'll say this, I think most people probably at one time or another 00:20:35.145 --> 00:20:38.775 have used a credit card for an emergency for something that they couldn't 00:20:38.775 --> 00:20:39.975 cover because they didn't have it. 00:20:40.335 --> 00:20:43.455 The problem is, and you could do that, but I think the price you pay 00:20:43.515 --> 00:20:47.115 in addition to a really high interest rate, and then another bill that you 00:20:47.115 --> 00:20:48.825 just have to Pay off in the future. 00:20:49.245 --> 00:20:52.075 I think the thing that robs from you is peace of mind. 00:20:52.125 --> 00:20:55.065 if you are doing that, if you're putting money on high interest credit, 00:20:55.365 --> 00:20:56.475 now you're stressed about that. 00:20:56.505 --> 00:20:57.585 Now you're thinking about that. 00:20:57.585 --> 00:20:59.835 Now you feel guilty about that and you have a problem. 00:21:00.225 --> 00:21:05.465 Whereas if you had a cash reserve fund that you can dip into you, you have that 00:21:05.465 --> 00:21:09.205 peace of mind of I had to use my emergency fund for what it was intended for. 00:21:09.445 --> 00:21:12.625 And sure it sucks that I don't have whatever that amount is for you, which 00:21:12.625 --> 00:21:16.495 we'll talk about $10,000, $15,000 anymore 'cause I had to spend some of it. 00:21:17.005 --> 00:21:19.945 At least you have the peace of mind of knowing that you use the money 00:21:19.975 --> 00:21:21.325 in a way that it was intended for. 00:21:21.625 --> 00:21:23.095 And if you don't use it, guess what? 00:21:23.095 --> 00:21:25.435 You have peace of mind too, and you can sleep well knowing Hey, if 00:21:25.435 --> 00:21:28.795 something does happen tonight, if I do have a leak in my roof and I 00:21:28.795 --> 00:21:30.085 know I need to fix it right away. 00:21:30.480 --> 00:21:31.800 I have the money to be able to do that. 00:21:32.025 --> 00:21:33.615 Jon: Yeah, I think that's a good point. 00:21:33.615 --> 00:21:35.865 And something that gets often overlooked. 00:21:35.925 --> 00:21:38.445 And what you're describing, Louie, is something that they call 00:21:38.445 --> 00:21:39.975 bucketing or mental accounting. 00:21:40.025 --> 00:21:43.265 Where you have a certain fund or whatever, but you only envision 00:21:43.265 --> 00:21:44.945 it being used for this one thing. 00:21:45.305 --> 00:21:49.385 So for a lot of people it might be like a job loss or something else like that, 00:21:49.385 --> 00:21:50.675 and that's what they're gonna use it for. 00:21:51.075 --> 00:21:55.215 what's hard about that when you bucket it to such a stringent thing is a lot 00:21:55.215 --> 00:21:57.115 of people won't use it for what is. 00:21:57.270 --> 00:22:00.630 Probably considered an emergency, and what they end up doing is they 00:22:00.630 --> 00:22:01.890 end up putting it on a credit card. 00:22:01.950 --> 00:22:02.070 Yeah. 00:22:02.370 --> 00:22:05.280 Alright, so what would you do to this firefighter? 00:22:05.280 --> 00:22:09.780 So you're sitting around the kitchen table having a conversation and they're talking 00:22:09.780 --> 00:22:13.230 about their credit card debt and that they got eight grand in credit card debt. 00:22:13.470 --> 00:22:13.890 All right. 00:22:13.890 --> 00:22:15.720 So you're like, oh, okay, we can talk about how to waste. 00:22:15.990 --> 00:22:16.650 To pay that off. 00:22:16.650 --> 00:22:21.090 But now they're also talking to you about how they have a $5,000 emergency 00:22:21.090 --> 00:22:23.130 fund set aside for emergencies. 00:22:23.620 --> 00:22:26.080 how would you go about counseling that firefighter? 00:22:26.695 --> 00:22:27.475 Louie: Oh yeah, sure. 00:22:27.640 --> 00:22:29.980 Jon: it better to keep that truly for emergencies? 00:22:30.025 --> 00:22:30.175 Louie: Yeah. 00:22:30.550 --> 00:22:34.720 Jon: Or should we start tackling something that is, you know, considerable amount 00:22:34.720 --> 00:22:38.020 of interest, whether that's, you know, probably best case scenario, 20%. 00:22:38.120 --> 00:22:40.430 Worst case scenario might be closer to 30%. 00:22:40.880 --> 00:22:43.910 and I, dude, this is one that I've actually had some conversations with, 00:22:43.910 --> 00:22:47.270 and this is not an easy conversation for one, first, someone's gotta 00:22:47.270 --> 00:22:50.780 be pretty trusting and vulnerable to open up about debt, right? 00:22:50.960 --> 00:22:51.020 Yeah. 00:22:51.080 --> 00:22:55.100 Not everyone is so forthcoming about that, but then it really is okay, now 00:22:55.100 --> 00:22:59.900 you as a trusted person who understands finance and understands numbers like. 00:23:00.560 --> 00:23:03.485 How do you counsel on how to make that decision? 00:23:03.760 --> 00:23:07.890 Louie: Yeah, I, that really depends on the person because there are certain 00:23:07.890 --> 00:23:11.250 people who are like, yeah, I have $8,000 of credit card debt that I want to pay 00:23:11.250 --> 00:23:12.750 off and I want to get on the right path. 00:23:12.890 --> 00:23:17.090 And I have a secure job and I know that I can work some overtimes if I need to. 00:23:17.090 --> 00:23:18.950 So basically I'm talking about firefighters, right? 00:23:19.350 --> 00:23:23.940 is it okay for me to dip into my emergency fund to, to cover this high interest debt? 00:23:24.600 --> 00:23:28.740 I would say that, I would say that it could be okay to dip some in, dip 00:23:28.740 --> 00:23:32.310 into your emergency fund to a certain extent, but I still think that you 00:23:32.310 --> 00:23:36.300 want to keep a dedicated fund set aside, whether that's $5,000 or. 00:23:36.660 --> 00:23:41.640 $2,000 or even a thousand dollars just to fall back on so that you don't have 00:23:41.640 --> 00:23:44.550 to put more money on a credit card that you've been working hard to pay off. 00:23:44.550 --> 00:23:44.610 Yeah. 00:23:44.670 --> 00:23:47.410 So I'm actually a fan of kind of keeping it separately and say, look, 00:23:47.410 --> 00:23:51.070 if you have a, let's just say you had that, I think you said 8,000 00:23:51.070 --> 00:23:55.570 or $5,000 emergency fund, an $8,000 credit card, I would probably say. 00:23:56.000 --> 00:23:58.040 Stop saving for your emergency fund. 00:23:58.040 --> 00:24:02.600 Don't put any more money into that $5,000 emergency fund, and instead, every 00:24:02.600 --> 00:24:07.280 paycheck that you get, start attacking that credit card and paying it off, but 00:24:07.280 --> 00:24:12.510 don't necessarily deplete your, your emergency fund in order to pay that debt. 00:24:13.295 --> 00:24:13.745 My gut. 00:24:13.745 --> 00:24:14.765 That's what my gut's telling me. 00:24:14.765 --> 00:24:15.005 Yeah. 00:24:15.065 --> 00:24:15.605 What do you think, 00:24:15.920 --> 00:24:16.370 Jon: man? 00:24:16.420 --> 00:24:17.350 I totally agree with you. 00:24:17.350 --> 00:24:18.700 It really is gonna depend on it. 00:24:18.700 --> 00:24:21.860 So I think the first thing that you have to peel back with some of 00:24:21.860 --> 00:24:25.370 these things is how did we get to this place to begin with the $8,000? 00:24:25.370 --> 00:24:29.420 And not once again a, a assigning fault or shame, unless you can 00:24:29.420 --> 00:24:32.900 change the behavior of that person, we're just gonna end up right back 00:24:32.915 --> 00:24:33.095 Louie: here. 00:24:33.245 --> 00:24:33.425 Mm-hmm. 00:24:33.710 --> 00:24:35.720 Jon: you know, kinda the first order of business is a little, let's cut 00:24:35.720 --> 00:24:36.535 up the credit card 'cause we can't. 00:24:37.160 --> 00:24:38.090 Use that anymore. 00:24:38.120 --> 00:24:40.340 'cause we're not using it responsibly to some degree. 00:24:40.340 --> 00:24:41.630 So we have to do that. 00:24:42.150 --> 00:24:45.030 and then I think you have to go back through a case by case basis. 00:24:45.030 --> 00:24:47.430 I think, you know, when you start to figure out how much do you 00:24:47.430 --> 00:24:50.760 need for a true emergency fund, I think you start there, right? 00:24:50.760 --> 00:24:53.550 And figure out what your costs are, what your living expenses are. 00:24:53.550 --> 00:24:55.740 So worst case scenario, what happens, how much. 00:24:55.805 --> 00:24:58.125 Would we anticipate you need, and work there? 00:24:58.125 --> 00:25:01.035 It might be where we dip into it a little bit, but we keep enough 00:25:01.035 --> 00:25:03.885 of a reserve where we still sleep well at night, we feel good. 00:25:04.245 --> 00:25:07.405 And then like you said, we go full blown Dave Ramsey and 00:25:07.405 --> 00:25:08.515 just go right at this thing. 00:25:08.515 --> 00:25:12.115 And every dollar that we have, we go to achieving, paying off that thing. 00:25:12.115 --> 00:25:13.105 And basically just. 00:25:13.490 --> 00:25:16.400 putting away the credit cards until we can, you know, use 'em in a manner 00:25:16.400 --> 00:25:18.050 that's not gonna put us in this position. 00:25:18.050 --> 00:25:22.610 'cause so many times, like credit card debt is a lot like dieting. 00:25:22.950 --> 00:25:26.370 I've seen this happen a lot where they'll be really good, you know, they'll put on a 00:25:26.370 --> 00:25:30.480 lot on a credit card, just like the, maybe they eat a lot around the holidays, right? 00:25:30.520 --> 00:25:30.730 Louie: They binge, 00:25:31.560 --> 00:25:35.220 Jon: and then they spend, you know, 5, 6, 7 months really working hard 00:25:35.220 --> 00:25:37.865 at it and really cutting away at that debt and that credit card. 00:25:38.830 --> 00:25:40.570 And then they get to almost zero balance. 00:25:40.810 --> 00:25:40.870 Yeah. 00:25:41.170 --> 00:25:44.740 But then once again, behaviorally, they just get back in this place 00:25:44.740 --> 00:25:48.335 where they then purge again and on another binge and get right back. 00:25:48.335 --> 00:25:52.535 And then it's really unhealthy, like high, low, high low kind of thing. 00:25:52.955 --> 00:25:55.265 And I think that's just one of those things that you have 00:25:55.265 --> 00:25:56.835 to once again get to the root. 00:25:56.920 --> 00:25:57.940 Of where we're at now. 00:25:57.940 --> 00:26:02.050 Once again, maybe this was something where it was a medical condition or something, 00:26:02.050 --> 00:26:06.820 or an automobile thing, you know, and they decided to put the $8,000 on a credit card 00:26:06.820 --> 00:26:08.620 instead of using their emergency fund. 00:26:08.980 --> 00:26:11.950 You know, I think this is probably a teachable moment to be like, Hey, man. 00:26:12.380 --> 00:26:14.750 You know, maybe in the future that's exactly what you should 00:26:14.750 --> 00:26:16.280 have used that emergency fund for. 00:26:16.580 --> 00:26:17.510 That's a true emergency. 00:26:17.510 --> 00:26:20.180 pay off that and then if you still have a little bit more on the credit 00:26:20.180 --> 00:26:23.750 card, that's much more manageable than putting all $8,000 on that. 00:26:23.750 --> 00:26:28.040 But you know so much it, so much of this comes down to people wanna make it a meth. 00:26:28.945 --> 00:26:32.225 Solution, the math says, yeah, dummy this interest rate's this high. 00:26:32.585 --> 00:26:37.055 But there's so much psychology involved with all of that stuff, and you really 00:26:37.055 --> 00:26:41.525 have to start to unpack that and figuring out how you got to where you are and then 00:26:41.525 --> 00:26:43.295 what's the best pathway moving forward. 00:26:43.295 --> 00:26:45.305 it's, you're talking to two different people here and you're 00:26:45.305 --> 00:26:46.295 gonna get two different answers. 00:26:46.295 --> 00:26:49.655 And it really is gonna depend on the person themselves and 00:26:49.655 --> 00:26:50.795 what they are comfortable with. 00:26:50.795 --> 00:26:51.250 'cause once again. 00:26:51.580 --> 00:26:55.140 You know, Louie and I can give you guys solutions and guidance all day 00:26:55.140 --> 00:26:56.850 long, but you gotta be on board for it. 00:26:56.850 --> 00:26:57.180 you gotta be 00:26:57.195 --> 00:26:57.225 Louie: uhhuh 00:26:57.270 --> 00:26:58.680 Jon: one carrying that torch. 00:26:58.800 --> 00:26:58.860 Yeah. 00:26:58.950 --> 00:27:00.000 We can't do that for you. 00:27:00.050 --> 00:27:03.220 but this is one, I see this a lot where I see people get pretty 00:27:03.220 --> 00:27:07.260 extended on their credit cards and a lot of it is, you know, they just. 00:27:07.795 --> 00:27:10.545 We, dude, firefighters love to, do things. 00:27:10.545 --> 00:27:13.005 They like to go places, they like to have experiences. 00:27:13.315 --> 00:27:16.015 they typically have some toys associated with those things. 00:27:16.255 --> 00:27:17.515 Just an expensive lifestyle. 00:27:17.995 --> 00:27:21.805 It is, you know, and it's very easy because the get outta jail free card 00:27:22.225 --> 00:27:25.505 is, if I just work, you know, if I go on one wild wildland deployment, 00:27:25.805 --> 00:27:28.505 if I just work three or 4 24 hour shifts, or I go work down at the 00:27:28.505 --> 00:27:31.205 training center and pick up some overtime, then I can pay this off and. 00:27:32.000 --> 00:27:34.710 It just, it's something I see come in day in 00:27:34.770 --> 00:27:37.325 Louie: oh, when you talk about it, when you build your extra 00:27:37.325 --> 00:27:41.345 duty shifts onto your, into your budget as part of your spending. 00:27:41.345 --> 00:27:42.995 I, that it's just, it's tricky. 00:27:43.055 --> 00:27:45.215 'cause then when you don't get those overtimes, if it's drying up 00:27:45.215 --> 00:27:46.955 or if it's hard, now you're behind 00:27:46.980 --> 00:27:47.610 Jon: you're behind. 00:27:47.610 --> 00:27:49.020 It's a slippery slope too. 00:27:49.020 --> 00:27:52.920 And the other part is, man, like you, we work here enough, 48 00:27:52.920 --> 00:27:54.750 hours, you know, 56 hours a week. 00:27:55.045 --> 00:27:55.945 Should be enough. 00:27:56.225 --> 00:27:56.675 and I think 00:27:56.755 --> 00:27:57.210 Louie: enough for me. 00:27:57.305 --> 00:28:00.665 Jon: I think all the evidence really points to like, you know, trying to get 00:28:00.665 --> 00:28:04.595 away from this place as much as you can is really healthy from not only just 00:28:04.595 --> 00:28:07.415 a physical perspective, you actually getting restorative sleep and all 00:28:07.415 --> 00:28:10.865 those other things, but relationships and emotional and all those other 00:28:10.865 --> 00:28:12.365 things, and you just get shit full man. 00:28:13.650 --> 00:28:13.980 Louie: It's totally agree. 00:28:13.980 --> 00:28:14.730 Shit full. 00:28:14.735 --> 00:28:14.785 Yep. 00:28:15.245 --> 00:28:18.035 Jon: You know, but this is one though when we're talking about emergency funds 00:28:18.035 --> 00:28:23.075 and what classifies as a true emergency, like I've definitely seen people try 00:28:23.075 --> 00:28:24.545 to walk a fine line with this one. 00:28:24.545 --> 00:28:24.605 Yeah. 00:28:24.965 --> 00:28:27.695 Where they have some money in savings, but they don't want to touch it 00:28:27.785 --> 00:28:31.235 because they have it earmarked for like true, like catastrophic things. 00:28:31.665 --> 00:28:33.825 so they end up putting a lot of things on the credit card where, 00:28:34.185 --> 00:28:38.885 you know, once again, I think this probably was an un unexpected expense, 00:28:38.885 --> 00:28:41.465 but it's something that you need, once again, whether it's medical. 00:28:41.470 --> 00:28:43.180 Auto home, something like that. 00:28:43.520 --> 00:28:44.090 it's okay. 00:28:44.090 --> 00:28:45.560 It's okay to dip into that emergency fund. 00:28:45.560 --> 00:28:48.800 You didn't lose like that is the whole purpose for that thing being there. 00:28:49.070 --> 00:28:49.130 Yeah. 00:28:49.160 --> 00:28:51.350 And then we just work on shoring it back up. 00:28:51.350 --> 00:28:55.010 But dude, I'm just telling you, it's like loss aversion people really, man, they 00:28:55.010 --> 00:28:58.040 like to see that number and they never want to see a drop below that number. 00:28:58.070 --> 00:28:58.130 Yeah. 00:28:58.160 --> 00:29:02.600 I don't know, man, psychology's, it's very interesting to see how the human mind 00:29:02.600 --> 00:29:04.160 thinks and how it accounts for things. 00:29:04.210 --> 00:29:04.270 yeah. 00:29:04.330 --> 00:29:05.950 And it's not a math problem anymore. 00:29:06.040 --> 00:29:06.190 No. 00:29:06.250 --> 00:29:07.960 People do not want to pull out of that 00:29:08.095 --> 00:29:09.505 Louie: It's very rarely a math problem. 00:29:09.505 --> 00:29:12.355 And as much as we pick on Dave Ramsey, he does say that, he goes, you didn't get 00:29:12.355 --> 00:29:14.665 into this debt situation because of math. 00:29:14.725 --> 00:29:16.195 You got into it because of behavior. 00:29:16.285 --> 00:29:16.435 Correct. 00:29:16.585 --> 00:29:18.535 And so you gotta fix that first. 00:29:18.735 --> 00:29:22.185 and then we could start arguing about the optimization of. 00:29:22.770 --> 00:29:26.070 Paying off your debt with your emergency fund, you know we're not gonna beat you up 00:29:26.070 --> 00:29:27.750 if you've fixed the behavioral problems. 00:29:27.750 --> 00:29:27.870 We're 00:29:27.945 --> 00:29:28.035 Jon: Yeah. 00:29:28.485 --> 00:29:29.265 100%. 00:29:29.565 --> 00:29:32.445 So what, so how much should we have? 00:29:32.445 --> 00:29:34.635 So I already talked about what it is, right? 00:29:34.635 --> 00:29:37.815 We talked about why you need to have one, why you should have one. 00:29:38.135 --> 00:29:40.385 but now how much should we have in an emergency 00:29:40.415 --> 00:29:40.625 Louie: fund? 00:29:40.725 --> 00:29:40.875 Yeah. 00:29:40.875 --> 00:29:44.865 This is a much debated topic I've heard anywhere from one month to 00:29:44.895 --> 00:29:48.715 two years depending on, what, where we're at in the economic cycle. 00:29:48.715 --> 00:29:52.585 And, you know, if you ask people in 2009 how much they should have had, 00:29:52.585 --> 00:29:55.345 they've been like, you should have had three years of emergency fund savings. 00:29:55.630 --> 00:29:57.320 but when the times are good and you know, the. 00:29:57.770 --> 00:30:00.710 People flying high, the economy's burning hot people will be 00:30:00.710 --> 00:30:01.820 like, ah, I just have a month. 00:30:01.820 --> 00:30:02.450 No big deal. 00:30:02.525 --> 00:30:03.305 Jon: get another job. 00:30:03.305 --> 00:30:04.055 No problem. 00:30:04.160 --> 00:30:05.360 Louie: can get any job you want. 00:30:05.640 --> 00:30:11.610 I would say though, that most experts congeal around a three to six month 00:30:11.610 --> 00:30:14.220 emergency fund that consists of your. 00:30:14.840 --> 00:30:16.490 Basic living expenses. 00:30:16.610 --> 00:30:20.930 So a good way to do this exercise is to figure out how much it costs you to 00:30:20.930 --> 00:30:23.030 live you or and your family to live. 00:30:23.030 --> 00:30:26.120 So that would include things like your rent or your mortgage payment. 00:30:26.390 --> 00:30:30.650 It would include your grocery bill, it would include all of those fixed 00:30:30.650 --> 00:30:34.070 costs, utilities, you know, you gotta pay excel, you gotta have heat in the 00:30:34.070 --> 00:30:36.240 winter, and maybe AC in the summer. 00:30:36.330 --> 00:30:38.280 Those fixed living expenses. 00:30:39.070 --> 00:30:42.910 Take that number, that monthly number, and multiply it by three to 00:30:42.910 --> 00:30:46.840 six, and that will give you a good idea of what your emergency fund is. 00:30:46.870 --> 00:30:51.830 So let's say, you are able to get your budget and take away all the 00:30:52.190 --> 00:30:54.050 unnecessary items that you don't need. 00:30:54.050 --> 00:30:56.800 You don't need Netflix when you're, when you've lost a job. 00:30:56.800 --> 00:30:59.340 You don't need, dining out money when you've lost a job. 00:30:59.680 --> 00:31:00.610 but you do need groceries. 00:31:00.610 --> 00:31:01.480 You do need rent. 00:31:01.480 --> 00:31:02.320 You do need those things. 00:31:02.590 --> 00:31:06.370 So take your basic fundamental budget, multiply it by. 00:31:06.620 --> 00:31:09.140 Three and say, that's what I need. 00:31:09.170 --> 00:31:13.280 If that's $5,000 a month, that means you need a $15,000 emergency fund if 00:31:13.280 --> 00:31:15.650 you're a big spender, 'cause you're spending everything you get and that 00:31:15.740 --> 00:31:20.090 things are just tight and you're spending $8,000 a month on your basic 00:31:20.090 --> 00:31:24.890 living expenses, that means you need $24,000 at least in an emergency fund. 00:31:25.070 --> 00:31:26.270 And I know that's a lot of money. 00:31:26.270 --> 00:31:27.400 I know people are cringing. 00:31:27.400 --> 00:31:32.200 Just hearing like you're saying, I need to have 20, about $25,000 just set aside for. 00:31:32.700 --> 00:31:35.190 No purpose except for the eventual emergency. 00:31:35.340 --> 00:31:35.700 Yeah. 00:31:35.790 --> 00:31:36.420 That's what I'm saying, 00:31:36.870 --> 00:31:39.600 Jon: and I think that's part of why it's hard for some people to 00:31:39.600 --> 00:31:42.905 wrap their head around this because it just seems like it's such a. 00:31:44.340 --> 00:31:44.940 Louie: tough and 00:31:44.985 --> 00:31:48.075 Jon: Ill achievable goal at the very beginning when you're only putting a 00:31:48.075 --> 00:31:52.245 couple hundred bucks a month or a paycheck away, you're like, dude and Lou, you're 00:31:52.245 --> 00:31:53.535 telling me this is gonna take me eight 00:31:53.835 --> 00:31:54.255 Louie: Mm-hmm. 00:31:54.555 --> 00:31:58.155 Jon: at, you know, a hundred dollars per month to get to my emergency fund. 00:31:58.155 --> 00:31:59.115 that ain't gonna happen. 00:31:59.575 --> 00:32:01.105 and that is the reality of this. 00:32:01.105 --> 00:32:01.975 And, you know. 00:32:02.495 --> 00:32:05.855 We haven't even got into how is this more important than funding your 00:32:05.855 --> 00:32:08.015 4 57 and all these other things. 00:32:08.015 --> 00:32:10.895 And that's for a whole other topic of conversation. 00:32:10.895 --> 00:32:15.295 But really this is one that man, you wanna have an emergency fund, you 00:32:15.295 --> 00:32:17.275 just do because life is gonna happen. 00:32:17.275 --> 00:32:21.085 Things are gonna come up, and you're gonna want to be able to have that cash reserve. 00:32:21.115 --> 00:32:23.665 You're gonna have peace of mind and you're gonna be able to pay that off. 00:32:23.665 --> 00:32:26.275 And, you know, three months seems a lot more achievable for 00:32:26.275 --> 00:32:27.955 a lot of folks in six months. 00:32:28.075 --> 00:32:31.885 And that's been the rule of thumb is if you have two, two incomes, right? 00:32:31.885 --> 00:32:35.215 So if you work and your spouse works probably closer to the three months, 00:32:35.215 --> 00:32:38.455 if it's just you, that's the sole income provider, maybe six months. 00:32:38.455 --> 00:32:42.360 But once again, we talked about job security for us and you know, the fact of. 00:32:42.665 --> 00:32:44.975 Completely getting laid off is pretty rare. 00:32:45.195 --> 00:32:48.945 so maybe it's even for the single income households out there. 00:32:48.945 --> 00:32:50.775 Firefighters, you're the breadwinners, right? 00:32:51.105 --> 00:32:52.305 maybe three months is okay. 00:32:52.305 --> 00:32:53.385 And I think that's a start. 00:32:53.535 --> 00:32:53.685 Yeah. 00:32:53.745 --> 00:32:56.795 You know, I think at the end of the day, you know, we're not, you know, 00:32:56.795 --> 00:33:00.215 we're just trying to get you guys there or something to think about. 00:33:00.215 --> 00:33:00.665 So 00:33:00.805 --> 00:33:01.195 Louie: I like to, in 00:33:01.210 --> 00:33:04.410 Jon: months does not seem to achievable three months, let's make that our goal. 00:33:04.500 --> 00:33:04.830 Louie: Yeah. 00:33:04.860 --> 00:33:07.860 and six months is such an overwhelming number and it takes so long that I 00:33:07.860 --> 00:33:09.120 just like to tell people three months. 00:33:09.120 --> 00:33:13.785 I, so I fall more on like the, I guess the liberal side of emergency fund. 00:33:13.785 --> 00:33:15.615 And I'm just like, just have, just get to three months. 00:33:15.615 --> 00:33:16.545 That's gonna take a while. 00:33:16.545 --> 00:33:17.205 It's a lot of work. 00:33:17.205 --> 00:33:18.015 It's a lot of effort. 00:33:18.195 --> 00:33:20.475 But you will sleep better and you will be able to cover a lot of 00:33:20.475 --> 00:33:23.745 emergencies if you have three months of your living expenses, six months. 00:33:23.745 --> 00:33:25.965 If you're really conservative, you're really nervous, I get it. 00:33:26.275 --> 00:33:28.435 I don't think you really need more than that for emergency, but. 00:33:28.840 --> 00:33:29.440 I like three. 00:33:29.440 --> 00:33:30.610 I think three's a great number 00:33:30.780 --> 00:33:31.830 Jon: how do you start building it up? 00:33:31.880 --> 00:33:34.640 you know, just like everything else, it's, you know, how do you eat an elephant? 00:33:34.640 --> 00:33:35.810 It's one bite at a time. 00:33:35.810 --> 00:33:40.400 So once again, it's just this is just setting up a habit or a process. 00:33:40.790 --> 00:33:43.880 So whether that's funneling some of your money from your payroll. 00:33:44.485 --> 00:33:47.365 To go into an account that's earmarked for emergency funds. 00:33:47.365 --> 00:33:52.525 So whether that's a couple hundred bucks a month or you know, 150, $200 a paycheck, 00:33:52.525 --> 00:33:54.025 and just start building it up small. 00:33:54.025 --> 00:33:56.695 So Dave Ramsey always starts with the small E fund. 00:33:56.695 --> 00:33:57.865 The baby E fund, right? 00:33:57.880 --> 00:33:58.060 Louie: Yep. 00:33:58.165 --> 00:33:59.545 Jon: So start with a thousand bucks. 00:34:00.115 --> 00:34:01.375 Now you got a thousand bucks. 00:34:01.845 --> 00:34:04.275 I think that gives you some momentum to start getting going. 00:34:04.275 --> 00:34:05.205 I'm like, okay, cool. 00:34:05.325 --> 00:34:07.455 I am still living in my means. 00:34:07.485 --> 00:34:08.775 I've got the thousand bucks. 00:34:09.165 --> 00:34:10.785 All right, maybe I can add a little bit more. 00:34:10.785 --> 00:34:13.125 And you just keep chopping away at it at that point. 00:34:13.125 --> 00:34:14.295 Louie: I think you gotta consider it a bill. 00:34:14.505 --> 00:34:17.835 I think you gotta just say look, I have a, this emergency fund bill 00:34:18.045 --> 00:34:19.215 that I have to pay every month. 00:34:19.215 --> 00:34:23.625 or twice a month when I get paid, when I get my paycheck in, it automatically goes 00:34:23.625 --> 00:34:26.955 from my checking account to a dedicated. 00:34:27.275 --> 00:34:29.495 Savings account, which we'll talk about in just a minute. 00:34:29.795 --> 00:34:31.315 And I don't even look at the money. 00:34:31.315 --> 00:34:32.455 I don't even pretend that it's there. 00:34:32.455 --> 00:34:34.705 I don't even assume that I could spend that money on something else. 00:34:34.975 --> 00:34:37.945 It just, every time I get paid the money, a certain portion of it 00:34:37.945 --> 00:34:41.755 just goes away into my emergency fund and I forget about it. 00:34:41.785 --> 00:34:43.105 I think that's how you have to look at it. 00:34:43.580 --> 00:34:43.790 Jon: Yeah. 00:34:43.790 --> 00:34:44.870 No, I like that. 00:34:44.880 --> 00:34:45.960 I like that framework. 00:34:46.020 --> 00:34:49.260 it just, it's one of those things though, and the hardest part is once 00:34:49.260 --> 00:34:52.620 you start getting some traction on this and start, you know, putting 00:34:52.620 --> 00:34:55.800 some money away, boy, it's just so tempting to want to get in there. 00:34:56.010 --> 00:34:58.350 It's just it's like getting your little hand in the cookie jar, man. 00:34:58.350 --> 00:35:00.390 You just, you got that vacation coming up. 00:35:00.960 --> 00:35:01.350 Do you? 00:35:01.350 --> 00:35:01.500 Trying 00:35:01.535 --> 00:35:02.670 Louie: can I use this for, man? 00:35:03.195 --> 00:35:03.415 Jon: man. 00:35:03.740 --> 00:35:04.400 Discipline. 00:35:04.490 --> 00:35:07.910 So much of this is just me having some discipline and just knowing what that 00:35:07.910 --> 00:35:11.880 job is and just setting it and letting it go, and then you're good to go. 00:35:11.880 --> 00:35:15.510 So you know that, that's the thing to think about the e fund and just know, 00:35:15.520 --> 00:35:18.640 you know, especially for firefighters, like you guys have the ability, even if 00:35:18.730 --> 00:35:21.600 you're new and you're starting off, or if you've been here for a while, you know. 00:35:22.120 --> 00:35:24.820 Overtimes can definitely boost this thing up in a hurry. 00:35:24.970 --> 00:35:25.060 Oh yeah. 00:35:25.090 --> 00:35:28.060 You start putting a couple overtime checks in there and really setting 00:35:28.060 --> 00:35:31.000 yourself up for success, man, you can really start to gain some momentum. 00:35:31.000 --> 00:35:34.960 So this does not have to be an arduous process where it does take you five years 00:35:35.350 --> 00:35:36.880 to build it up, like you can build up. 00:35:36.880 --> 00:35:40.000 I believe most people around here can build up a solid 00:35:40.000 --> 00:35:41.055 three month emergency plan. 00:35:41.305 --> 00:35:44.845 Louie: And if you commit to paying your holiday pay or your, your extra 00:35:44.845 --> 00:35:49.135 duty, your overtime shift into your emergency fund, it will build up quick. 00:35:49.225 --> 00:35:50.035 Jon: will build up quick. 00:35:50.035 --> 00:35:53.995 And then maybe after two years, 18 months, you're now gonna have a fully 00:35:53.995 --> 00:35:56.755 funded emergency fund and you never have to touch that thing ever again. 00:35:57.085 --> 00:35:57.745 Like it's great. 00:35:57.745 --> 00:36:02.745 It's a great achievable thing that's gonna just give you a lot of, peace of mind. 00:36:03.285 --> 00:36:07.115 And, inevitably when something comes up, man, there's something really nice 00:36:07.115 --> 00:36:08.795 about just something happening to you. 00:36:09.430 --> 00:36:12.700 You just cut a check or you just give cash or whatever. 00:36:12.700 --> 00:36:14.980 You put it on a card, but you have it paid off and you're good to go. 00:36:14.980 --> 00:36:15.340 Man. 00:36:15.745 --> 00:36:16.295 Louie: Feels good. 00:36:16.360 --> 00:36:16.370 Jon: good. 00:36:16.455 --> 00:36:17.045 It feels real good. 00:36:17.045 --> 00:36:17.080 Feels real 00:36:17.120 --> 00:36:17.840 Louie: Feels real good. 00:36:17.900 --> 00:36:18.290 Yeah. 00:36:18.830 --> 00:36:22.730 So the final aspect of this that, we need to talk about, and this is like I 00:36:22.730 --> 00:36:25.760 mentioned earlier, the one that I get asked most when it comes to emergency 00:36:25.760 --> 00:36:27.470 funds, and that's how do I make money? 00:36:27.470 --> 00:36:29.090 Or where do I keep my emergency fund? 00:36:29.090 --> 00:36:32.090 Is there any way I can make money on this or should I invest it? 00:36:32.120 --> 00:36:32.660 I get asked that 00:36:32.705 --> 00:36:32.975 Jon: question. 00:36:33.005 --> 00:36:33.095 Mm-hmm. 00:36:33.440 --> 00:36:35.300 Louie: should I put this in a brokerage account? 00:36:35.300 --> 00:36:38.030 In a taxable brokerage that you guys were just talking about a couple episodes 00:36:38.075 --> 00:36:38.735 Jon: Oh yeah. 00:36:38.915 --> 00:36:40.205 Love me some fidelity, 00:36:40.225 --> 00:36:43.225 Louie: some 8% a year on this bad boy, let's grow this emergency 00:36:43.225 --> 00:36:45.655 fund that way then I don't have to contribute more to it. 00:36:46.115 --> 00:36:48.545 so let's address that real quick, John. 00:36:48.545 --> 00:36:52.805 What are your thoughts on the best places or where a firefighter should 00:36:52.805 --> 00:36:54.695 keep his or her emergency fund? 00:36:55.155 --> 00:36:55.635 Jon: Yeah. 00:36:55.635 --> 00:37:00.165 So once again, getting back to what is the definition or what is the purpose? 00:37:00.225 --> 00:37:04.115 The purpose of the emergency fund is to have Liquidity, alright. 00:37:04.115 --> 00:37:05.975 So you have to have access immediately. 00:37:06.335 --> 00:37:09.185 And this is the problem where people get involved with the stock market. 00:37:09.185 --> 00:37:10.265 they're like, dude, I have access. 00:37:10.265 --> 00:37:10.905 I can just sell it. 00:37:10.905 --> 00:37:11.070 Yeah. 00:37:11.500 --> 00:37:14.410 But the problem is we don't know what the value of that stock is gonna be. 00:37:14.800 --> 00:37:17.200 So we don't wanna sell stock if it's gone down. 00:37:17.230 --> 00:37:19.590 We don't wanna, have a real loss on that. 00:37:19.590 --> 00:37:21.150 So it's gotta be something that's liquid. 00:37:21.270 --> 00:37:22.530 Yeah, first and foremost. 00:37:22.530 --> 00:37:26.490 So most people would argue, and I'm in full agreement, that 00:37:26.550 --> 00:37:31.320 putting it in a high yield savings account is gonna be your best part. 00:37:31.440 --> 00:37:31.800 You know, 00:37:31.915 --> 00:37:36.925 Louie: the uns Sexiest of Savings Methods Right, is just a standard high yield 00:37:37.125 --> 00:37:37.465 Jon: Yeah. 00:37:37.525 --> 00:37:39.145 not a regular savings account. 00:37:39.145 --> 00:37:42.175 So this is not this checking account or the savings account 00:37:42.175 --> 00:37:43.915 you have in your bank, all right? 00:37:43.915 --> 00:37:46.195 'cause most of the time those are not high yield. 00:37:46.465 --> 00:37:50.705 They're paying you literally pennies on the dollar, put it into, and trust 00:37:50.705 --> 00:37:54.225 me, they're very good at marketing this, from the banking perspective 00:37:54.225 --> 00:37:57.435 in a high yield savings account where they will be able to call you out 00:37:57.435 --> 00:37:59.595 what the annual percentage radar is. 00:37:59.670 --> 00:38:01.920 The APRs so you can actually compare. 00:38:01.920 --> 00:38:05.360 Yeah, You can compare different things and there's a lot of different vendors 00:38:05.360 --> 00:38:08.000 out there and a lot of different businesses that you can choose. 00:38:08.250 --> 00:38:11.580 I personally use, ally Bank for my high yield savings 00:38:11.835 --> 00:38:12.405 Louie: that's a good one. 00:38:12.550 --> 00:38:13.930 Jon: it's something that's super easy. 00:38:13.930 --> 00:38:16.720 It's completely electronic and virtual, right? 00:38:16.720 --> 00:38:19.330 They dot, to my knowledge, they don't have any physical stores. 00:38:19.640 --> 00:38:21.795 I set it up, I funnel everything through there. 00:38:21.795 --> 00:38:24.855 And you know, currently now I think it's probably in the mid threes. 00:38:24.855 --> 00:38:24.915 Yeah. 00:38:24.945 --> 00:38:27.635 I think is somewhere that's getting, 18 months ago it was closer to 00:38:27.845 --> 00:38:28.985 four and a half, which is great. 00:38:28.985 --> 00:38:29.285 Five. 00:38:29.835 --> 00:38:32.835 but, and I just set it there and it just sits in that little account 00:38:32.835 --> 00:38:34.215 and I don't really touch it. 00:38:34.245 --> 00:38:34.305 Yeah. 00:38:34.435 --> 00:38:37.225 they made me put in a certain amount of money minimum to start, 00:38:37.225 --> 00:38:38.845 and then you just go with it. 00:38:38.845 --> 00:38:40.705 So you can really shop around on this 00:38:40.755 --> 00:38:41.055 Louie: Yeah. 00:38:41.085 --> 00:38:44.095 the reason why we say high yield savings is because even though we're 00:38:44.095 --> 00:38:47.365 not saying that the purpose of the emergency fund is to make money. 00:38:47.695 --> 00:38:50.455 If you can offset inflation a little bit, especially for an account that's 00:38:50.455 --> 00:38:53.065 just gonna sit there for hopefully years and you never have to touch, 00:38:53.065 --> 00:38:55.465 if you can get a little bit of interest on it, that would be great. 00:38:55.495 --> 00:38:59.215 So I like to use deposit accounts.com. 00:38:59.305 --> 00:38:59.845 Jon: Never heard of that 00:38:59.965 --> 00:39:01.735 Louie: Yeah, it's, it's almost like bank rate. 00:39:01.965 --> 00:39:04.905 it's very similar to that, or, NerdWallet is another one. 00:39:05.185 --> 00:39:06.475 I just like deposit accounts better. 00:39:06.475 --> 00:39:09.835 I feel like they have more different, like credit unions and 00:39:09.835 --> 00:39:11.305 stuff as well that are high yield. 00:39:11.305 --> 00:39:14.575 So you can filter it for high yield savings accounts and you can 00:39:14.575 --> 00:39:17.575 go check the rates, but they're generally gonna pay about three or 4%. 00:39:17.635 --> 00:39:19.825 Not earth shattering, not gonna be something that's gonna 00:39:19.825 --> 00:39:21.565 make you able to retire early. 00:39:21.875 --> 00:39:23.025 you'll have to listen to other episodes. 00:39:23.470 --> 00:39:26.560 Of the fiscal firehouse to figure out how to do that, but it will 00:39:26.560 --> 00:39:28.630 just offset inflation a little bit. 00:39:28.900 --> 00:39:31.330 High yield savings account, I believe is probably the way 00:39:31.330 --> 00:39:33.400 to go for most firefighters. 00:39:33.410 --> 00:39:35.450 just put your money in a high yield savings account, put your 00:39:35.600 --> 00:39:37.130 emergency fund there and forget about 00:39:37.245 --> 00:39:37.665 Jon: Yeah. 00:39:37.795 --> 00:39:42.415 another one that is commonly referenced is a money market account. 00:39:42.475 --> 00:39:42.925 All right. 00:39:42.925 --> 00:39:44.875 So it sounds very similar. 00:39:44.875 --> 00:39:47.755 It's a little bit different though in the logistics of how it's set up 00:39:47.755 --> 00:39:51.315 because, you know, typically you'll go through a brokerage firm, like 00:39:51.315 --> 00:39:52.815 a taxable account brokerage firm. 00:39:52.815 --> 00:39:56.355 So Fidelity, vanguard, they can do a money market in that concept. 00:39:56.665 --> 00:39:56.985 once again, it's. 00:39:57.530 --> 00:39:58.070 Safe. 00:39:58.070 --> 00:39:58.880 and it's a liquid. 00:39:58.880 --> 00:39:58.940 Yeah. 00:39:59.250 --> 00:40:01.470 it's just, the way that they invested is a little bit different. 00:40:01.580 --> 00:40:04.025 and sometimes there's actually a little bit more costs associated 00:40:04.025 --> 00:40:07.235 with a money market fund than there is a high yield savings account. 00:40:07.235 --> 00:40:09.005 But either one of those, you're gonna be fine. 00:40:09.005 --> 00:40:11.675 Like you're gonna have direct access to cash. 00:40:11.925 --> 00:40:15.825 you can get it within the day or within the 24 or 48 hours that you would need it. 00:40:15.875 --> 00:40:16.985 It's definitely the best way. 00:40:16.985 --> 00:40:20.525 So things to avoid are other long-term fixed income things. 00:40:20.525 --> 00:40:24.155 So don't put it in bonds, don't put it in stocks, don't put it in these 00:40:24.155 --> 00:40:27.855 other things that, you're gonna have to suffer some illiquidity and you 00:40:27.855 --> 00:40:29.625 might have to sell it at a discount. 00:40:29.625 --> 00:40:34.425 And that goes against the, excuse me, the purpose for having emergency fund to begin 00:40:34.685 --> 00:40:35.165 Louie: yeah, for sure. 00:40:35.240 --> 00:40:38.290 Jon: I think it's high yield savings or nothing at all. 00:40:38.665 --> 00:40:38.905 Yeah. 00:40:39.325 --> 00:40:40.135 Which is super easy. 00:40:40.375 --> 00:40:42.025 And the other thing is don't beat yourself up. 00:40:42.075 --> 00:40:45.945 don't go shopping for, you know, 18 different banks to try to save you 00:40:45.945 --> 00:40:47.765 an eighth of a hundredth of a point. 00:40:47.915 --> 00:40:47.975 Yeah. 00:40:48.085 --> 00:40:51.475 you know, if we got 25 grand in there, dude, the difference between 3.25 00:40:51.475 --> 00:40:52.525 and 3.3 00:40:52.525 --> 00:40:52.855 is not. 00:40:53.180 --> 00:40:53.960 Is not gonna move the 00:40:53.965 --> 00:40:54.775 Louie: needle, it's not gonna move. 00:40:54.870 --> 00:40:55.170 Jon: don't. 00:40:55.260 --> 00:40:57.660 Your time is more valuable doing something else with that. 00:40:57.660 --> 00:40:59.400 So find a place that you like. 00:40:59.680 --> 00:41:03.095 and honestly, I actually like to do it, at a completely separate bank. 00:41:03.395 --> 00:41:08.075 So like my emergency fund is that, that's the only thing I have my Ally account for, 00:41:08.120 --> 00:41:08.410 Louie: Okay. 00:41:09.115 --> 00:41:09.145 Okay. 00:41:09.145 --> 00:41:09.955 That's a good way to do it. 00:41:09.955 --> 00:41:09.985 I 00:41:09.995 --> 00:41:12.255 Jon: have it under my other, credit union account. 00:41:12.275 --> 00:41:13.745 Or my fidelity count. 00:41:13.745 --> 00:41:16.295 I like to have it completely out in right field. 00:41:16.415 --> 00:41:20.705 Yeah, because what also you'll find out is the more you have things commingled, 00:41:20.705 --> 00:41:23.585 I've noticed this behaviorally, like the more things you have commingled, 00:41:23.855 --> 00:41:27.155 the easier it is for the tendency to kind of want to go in there and 00:41:27.155 --> 00:41:28.295 like just take a little bit out. 00:41:28.385 --> 00:41:30.545 Just take a little something out of there and just move it over here. 00:41:30.545 --> 00:41:31.415 Louie: I'll never notice. 00:41:31.415 --> 00:41:32.705 I'll never notice if I take 00:41:32.735 --> 00:41:35.165 Jon: But if I have to be like, dude, I can't even remember what my 00:41:35.165 --> 00:41:39.335 stupid ally account login is because it's been, I don't know, 18 months 00:41:39.335 --> 00:41:40.385 since I've looked in this thing. 00:41:40.385 --> 00:41:41.015 that's good. 00:41:41.015 --> 00:41:42.905 That's actually really good for your emergency fund. 00:41:42.905 --> 00:41:44.135 'cause that means you haven't touched it. 00:41:44.365 --> 00:41:47.875 it's been doing its thing, it's safe over there and you're just good to go. 00:41:47.875 --> 00:41:52.165 So behaviorally, once again, if you guys can't figure out my mantra and what I 00:41:52.165 --> 00:41:56.095 really try to think about is creating good behaviors, dude, I just, that thing 00:41:56.095 --> 00:41:58.315 sits over there and I never even touch it. 00:41:58.510 --> 00:41:59.440 Louie: Yeah, I love it. 00:41:59.440 --> 00:41:59.830 I love it. 00:41:59.830 --> 00:42:03.160 I think simplifying and automating your emergency fund 00:42:03.370 --> 00:42:04.780 are the two biggest takeaways. 00:42:05.140 --> 00:42:08.290 Put in the high yield savings account, have it deduct from your bank account 00:42:08.290 --> 00:42:11.530 once a month or twice a month, your checking account, and just have it sit 00:42:11.530 --> 00:42:13.145 in that high yield savings account and. 00:42:13.930 --> 00:42:15.190 Hopefully you won't have to touch it. 00:42:15.340 --> 00:42:18.520 Jon: Yeah, and I think the big thing with this is if you guys have larger 00:42:18.520 --> 00:42:21.580 emergency funds just 'cause you have more expenses or whatever, then 00:42:21.580 --> 00:42:25.540 you probably can get more into the minutia about which rates paying the 00:42:25.540 --> 00:42:26.560 highest and all these other things. 00:42:26.590 --> 00:42:30.100 'cause at some point there will be those incremental changes where it will start 00:42:30.100 --> 00:42:32.060 to move the needle and it will, you know. 00:42:32.470 --> 00:42:34.810 It will be in your best interest to shop around. 00:42:34.810 --> 00:42:39.190 But for the majority of us, if you're putting in 20, 25, 30 grand in there, 00:42:39.220 --> 00:42:41.860 like just find something that you like, something that works for you, 00:42:41.890 --> 00:42:43.510 something that's accessible, right? 00:42:43.570 --> 00:42:45.880 And just go with there and then just don't worry about it. 00:42:45.970 --> 00:42:47.110 And that's just one other thing. 00:42:47.335 --> 00:42:50.455 Louie: So John, I'll just share this little kind of cool anecdote 00:42:50.455 --> 00:42:54.055 that's related to emergency funds, but it's just more about financial 00:42:54.055 --> 00:42:56.035 responsibility and budgeting in general. 00:42:56.035 --> 00:42:56.755 I guess. 00:42:56.815 --> 00:43:01.135 And it's this, I have not had to touch my emergency fund in about. 00:43:01.675 --> 00:43:03.535 Nine years, eight or nine years. 00:43:03.685 --> 00:43:09.055 And the reason why is because I'm, as you know, I'm a big advocate of budgeting, of 00:43:09.055 --> 00:43:12.175 giving every dollar a job and making sure you know where all your money is going. 00:43:12.595 --> 00:43:17.005 And I have built budget categories for all the different things that most people 00:43:17.005 --> 00:43:18.985 would consider emergencies, for example. 00:43:19.600 --> 00:43:21.610 New tires on my car is not an emergency. 00:43:21.610 --> 00:43:24.280 That's something that I need to plan for, just like oil changes 00:43:24.280 --> 00:43:26.140 and even car repairs in general. 00:43:26.140 --> 00:43:29.950 I know I have a depreciating asset that I'm driving around and I might need 00:43:29.950 --> 00:43:32.620 to pay for some work done to that car. 00:43:32.920 --> 00:43:36.580 So in my budget, I have a car maintenance fund that I fund every 00:43:36.580 --> 00:43:38.890 month, just a little bit every month, and I've been doing it for years. 00:43:39.250 --> 00:43:40.750 Home improvement is the same way. 00:43:40.750 --> 00:43:42.850 I know that I have a bunch of depreciating. 00:43:43.570 --> 00:43:47.080 Things in my house, like a furnace, like an AC unit, you 00:43:47.080 --> 00:43:48.370 know, whatever in your house. 00:43:48.370 --> 00:43:51.340 So I have a home improvement category or a home repair 00:43:51.340 --> 00:43:53.560 category that I fund every month. 00:43:53.560 --> 00:43:56.980 So when there is what a lot of people would call an emergency, like 00:43:56.980 --> 00:43:58.540 my furnace goes out, guess what? 00:43:58.810 --> 00:44:01.060 I've been saving money in that for years and years. 00:44:01.060 --> 00:44:05.290 And now instead of having to reach into my emergency fund, I reach into 00:44:05.290 --> 00:44:07.720 my home improvement fund and I fix my. 00:44:08.560 --> 00:44:12.530 House that way, or if I, have a medical category for medical bills and things like 00:44:12.530 --> 00:44:14.360 that, that my insurance doesn't cover. 00:44:14.570 --> 00:44:17.810 So when we have to have, when my middle son had to have a procedure 00:44:17.810 --> 00:44:21.470 done earlier this year, I didn't have to reach into emergency fund for that. 00:44:21.470 --> 00:44:25.190 I reached into our medical category budget and I have. 00:44:26.150 --> 00:44:27.050 Paid for it that way. 00:44:27.590 --> 00:44:28.640 It's just something to think about. 00:44:28.640 --> 00:44:31.620 And this is like advanced, this is not necessarily personal finance 1 0 1. 00:44:31.620 --> 00:44:34.260 Maybe this is like a 3 0 1 or 4 0 1 kind of thing. 00:44:34.710 --> 00:44:40.020 But eventually, if you set up your budget correctly and you start anticipating your 00:44:40.020 --> 00:44:44.250 future needs, a lot of the things that you might consider an emergency are not really 00:44:44.250 --> 00:44:47.760 an emergency because those are things that you know you're gonna need to replace at 00:44:47.760 --> 00:44:49.350 some point, and you can plan for those. 00:44:49.830 --> 00:44:51.060 On a long time scale. 00:44:51.165 --> 00:44:54.615 Jon: Do you ever get to a point with your kind of, your budget and the way 00:44:54.615 --> 00:44:58.185 it's set up where you're like, okay, cool, I've got this much in reserves, 00:44:58.515 --> 00:45:01.545 I'm not gonna funnel anymore into that, or is this kind of something where 00:45:01.630 --> 00:45:02.950 Louie: for the emergency fund, yes. 00:45:02.950 --> 00:45:05.260 So I've capped that and I'm like, I don't wanna put anything more 00:45:05.260 --> 00:45:06.190 in there 'cause I don't need it. 00:45:06.730 --> 00:45:08.740 but in general I know my home. 00:45:09.690 --> 00:45:13.650 Repair and home maintenance category, there's always gonna be something. 00:45:13.650 --> 00:45:18.660 So even if it's a fairly big category, I know that at some point we're gonna need 00:45:18.690 --> 00:45:23.460 it to replace whatever it is, a toilet or a water heater or an ac, and tho those, 00:45:23.490 --> 00:45:26.070 you know, those cost 10,000, $15,000. 00:45:26.400 --> 00:45:30.690 So I just keep falling, funneling money into those categories, knowing 00:45:30.690 --> 00:45:32.550 that at some point I'll use it. 00:45:32.670 --> 00:45:33.155 And if I ever get. 00:45:33.445 --> 00:45:36.235 To the point where I have so much money in there that I'll never, 00:45:36.235 --> 00:45:37.795 ever possibly conceivably touch it. 00:45:38.255 --> 00:45:39.665 I've won, that's a great thing. 00:45:39.665 --> 00:45:42.245 I guess I could take money from that 'cause it's not an emergency fund. 00:45:42.485 --> 00:45:44.915 So I guess I could take some of the funds from that and put it 00:45:44.915 --> 00:45:48.635 into my Disney vacation fund if I wanted to or something like that. 00:45:49.085 --> 00:45:52.145 But since I've been doing that for so long, I've realized like 00:45:52.235 --> 00:45:54.965 I, it doesn't seem like I have a need for an emergency fund now. 00:45:54.965 --> 00:45:55.715 I still have one. 00:45:55.715 --> 00:45:55.775 Yeah. 00:45:55.955 --> 00:45:56.825 Just in case. 00:45:57.305 --> 00:46:02.105 But I have tried to anticipate all these other needs that we said are emergencies. 00:46:02.180 --> 00:46:06.050 And that is what I draw on when I have a quote unquote emergency. 00:46:06.155 --> 00:46:09.695 Jon: So did you have to increase your emergency fund when you 00:46:09.695 --> 00:46:10.835 moved into your new house? 00:46:10.835 --> 00:46:13.955 Probably some more costs associated with this from like a living expense 00:46:13.955 --> 00:46:17.825 or because you've budgeted in a manner for all these other things that you 00:46:17.825 --> 00:46:19.385 know at some point are gonna come do. 00:46:19.775 --> 00:46:21.125 You just kinda left that emergency 00:46:21.125 --> 00:46:21.725 Louie: I left it. 00:46:21.725 --> 00:46:24.335 And I don't know, maybe a lot of financial experts would've said, oh 00:46:24.335 --> 00:46:25.745 man, you're going into a bigger house. 00:46:25.745 --> 00:46:27.005 There's gonna be more stuff. 00:46:27.005 --> 00:46:28.355 you gotta have that set aside. 00:46:28.745 --> 00:46:31.505 But we really looked into it, we really talked about it a 00:46:31.505 --> 00:46:32.705 lot, and we said, we have. 00:46:33.185 --> 00:46:37.855 Enough in these other budget categories that even with the bigger house, we 00:46:37.855 --> 00:46:39.445 think that we are going to be fine. 00:46:39.445 --> 00:46:43.255 And sure enough, so far we have, we've dipped into some home repairs 00:46:43.255 --> 00:46:44.815 and stuff like that, that category. 00:46:45.175 --> 00:46:46.965 But, yeah, it's worked really well for us. 00:46:46.965 --> 00:46:50.275 And that's just a way to show you guys, not that you don't need an emergency fund, 00:46:50.275 --> 00:46:54.625 it's just to show you that eventually your emergency fund becomes like this little 00:46:54.625 --> 00:46:56.875 thing that you have out there in the. 00:46:57.240 --> 00:47:00.420 in the cloud that kind of protects you, but it doesn't 00:47:00.420 --> 00:47:02.640 really impact your daily life. 00:47:02.790 --> 00:47:05.190 It's a great goal to have and not everyone's gonna get there, 00:47:05.190 --> 00:47:06.330 especially not right away. 00:47:06.630 --> 00:47:08.970 But, it's been something that has been cool for our peace of 00:47:08.970 --> 00:47:11.820 mind and something that I think is a cool thing to work toward. 00:47:11.965 --> 00:47:15.865 Jon: Yeah, and I think, you know, this is just a case of point is everyone does 00:47:15.865 --> 00:47:19.165 finance a little bit different and you have to figure out what works for you. 00:47:19.535 --> 00:47:22.955 and whether that's through budgeting software or some other kind of 00:47:23.705 --> 00:47:27.635 accountability tracking, whatever, or if you just know that, hey, because 00:47:27.635 --> 00:47:30.210 of all the things in my lifestyle, I know that this is what my. 00:47:30.770 --> 00:47:33.800 Basic living costs are every month, even with some of these repairs and 00:47:33.800 --> 00:47:37.010 everything else, and you just know and you can round up to about that number. 00:47:37.010 --> 00:47:39.260 You're still getting to the same place and everyone's just gonna 00:47:39.260 --> 00:47:40.130 do it a little bit different. 00:47:40.460 --> 00:47:44.090 It just depends on how your brain works and how you like to think about things. 00:47:44.090 --> 00:47:46.580 And I know you really like things in a nice. 00:47:46.640 --> 00:47:49.670 Orderly manner and like to categorize things and be 00:47:49.670 --> 00:47:50.840 like, okay, this is for this. 00:47:50.840 --> 00:47:54.380 And you're definitely a big kind of bucket guy and just allocating it that way. 00:47:54.890 --> 00:47:57.500 And I get a lot of our other folks who are just like, Hey man, I just wanna know 00:47:57.500 --> 00:47:59.240 how much am I gonna cost me every month? 00:47:59.250 --> 00:48:00.150 what's my averages? 00:48:00.240 --> 00:48:03.120 And as long as I've got that much money set aside, then I'm good. 00:48:03.120 --> 00:48:04.350 and it all works out in the end. 00:48:04.350 --> 00:48:04.410 Yeah. 00:48:04.720 --> 00:48:06.280 so just do what works for you. 00:48:06.470 --> 00:48:10.430 these are just other things to consider or try if you are. 00:48:10.490 --> 00:48:14.510 Not as successful as you want to be when it comes to some of the budgeting and the 00:48:14.510 --> 00:48:19.190 funding and whether or not these things are truly emergencies or not, it's all 00:48:19.190 --> 00:48:20.690 gonna be in the eye of the beholder. 00:48:20.950 --> 00:48:22.180 but just things to consider. 00:48:22.210 --> 00:48:22.300 Yep. 00:48:22.570 --> 00:48:24.970 So not always like a super sexy topic. 00:48:24.970 --> 00:48:27.730 We get that thing, but man, this is definitely one though. 00:48:28.140 --> 00:48:32.490 if you get ahead of the curve on this one, we've always tried to set our folks 00:48:32.490 --> 00:48:36.690 up for success and really let them become financially secure and independent. 00:48:36.690 --> 00:48:40.350 And this is like step one, like when I'm meeting with people and we're going 00:48:40.350 --> 00:48:43.980 through things and talking about other things and funding things and whatever. 00:48:43.980 --> 00:48:45.120 This is the first one, man. 00:48:45.120 --> 00:48:46.080 This is in my top. 00:48:46.205 --> 00:48:47.495 Two questions I'll ask. 00:48:47.495 --> 00:48:47.555 Yeah. 00:48:47.945 --> 00:48:50.225 Is, how much money do you have in an emergency fund? 00:48:50.225 --> 00:48:51.305 Or what does that look like? 00:48:51.695 --> 00:48:53.585 And I'll be honest, it's all over the board. 00:48:53.585 --> 00:48:56.975 But this is one for a man, if you really wanna set yourself up for 00:48:56.975 --> 00:48:58.235 success, you gotta have this one. 00:48:58.235 --> 00:48:59.975 Because if not, you're gonna end up. 00:49:00.330 --> 00:49:03.120 Naturally putting things on credit cards and you're not gonna be able to pay 'em 00:49:03.120 --> 00:49:06.660 off and you're just gonna be paying a high interest rate when you don't have to. 00:49:06.665 --> 00:49:06.895 Yeah. 00:49:06.995 --> 00:49:11.280 And it's just prioritizing and just doing it, but it's really hard to, 'cause it's 00:49:11.280 --> 00:49:14.250 like you said, a lot of times you get to a point where you won't need this thing and 00:49:14.250 --> 00:49:18.090 now you just have this like money sitting there and you feel like obligated, like 00:49:18.090 --> 00:49:20.250 somehow you're missing out on something. 00:49:20.250 --> 00:49:23.760 you're being almost financially irresponsible for not having 00:49:23.760 --> 00:49:24.810 this money go to work. 00:49:24.870 --> 00:49:25.590 Like I should be like. 00:49:25.790 --> 00:49:26.240 Growing 00:49:26.625 --> 00:49:29.115 Louie: Hey, that's a problem that we'll deal with when you get there. 00:49:29.115 --> 00:49:29.295 All right. 00:49:29.295 --> 00:49:31.575 When everyone gets there, that's a good problem to have 00:49:31.785 --> 00:49:33.315 and we can figure it out later. 00:49:33.410 --> 00:49:34.490 Jon: 100%. 00:49:34.490 --> 00:49:35.390 100%. 00:49:35.390 --> 00:49:37.490 So yeah, let us know, guys, what you guys think. 00:49:37.540 --> 00:49:40.280 about the emergency funds, once again, I don't think this is gonna 00:49:40.280 --> 00:49:43.615 blow anyone's hair back, but, hopefully once again, it demystifies. 00:49:44.235 --> 00:49:45.765 What is the purpose? 00:49:45.825 --> 00:49:47.295 You're not a failure. 00:49:47.295 --> 00:49:49.995 If you have an emergency fund and you don't step and you 00:49:49.995 --> 00:49:50.925 don't use it, that's great. 00:49:51.050 --> 00:49:51.860 Louie: That's wonderful. 00:49:51.980 --> 00:49:52.190 Yeah, 00:49:52.215 --> 00:49:54.405 Jon: It's having life insurance and never having to file a claim, 00:49:54.435 --> 00:49:55.665 like that's just a great thing to 00:49:55.670 --> 00:49:55.730 Louie: do. 00:49:55.730 --> 00:49:55.820 Boom. 00:49:55.845 --> 00:49:55.935 Jon: Mm-hmm. 00:49:56.265 --> 00:49:57.225 All right. 00:49:57.315 --> 00:50:00.315 All right, so best of luck to everyone's brackets out there. 00:50:00.405 --> 00:50:00.495 Mm-hmm. 00:50:00.735 --> 00:50:01.755 March Madness. 00:50:01.880 --> 00:50:03.590 Louie: the guys at Station three on the A shift. 00:50:04.010 --> 00:50:05.090 Bad luck to you guys. 00:50:05.090 --> 00:50:05.300 All right. 00:50:05.315 --> 00:50:05.975 Jon: luck to you. 00:50:06.285 --> 00:50:09.225 it's, it's always a very fun time of your, people that don't 00:50:09.225 --> 00:50:10.545 even really enjoy basketball. 00:50:10.545 --> 00:50:14.505 They do enjoy the, spirits and the upsets and all the emotions 00:50:14.505 --> 00:50:15.825 that go with March Madness. 00:50:15.825 --> 00:50:16.665 yeah, cheers. 00:50:16.665 --> 00:50:19.565 And, best of luck to everyone out there that's, watching or got 00:50:19.565 --> 00:50:21.155 some friendly wagers on there. 00:50:21.245 --> 00:50:25.265 please don't use your emergency fund to go all in on whoever. 00:50:25.505 --> 00:50:26.045 Please, 00:50:26.190 --> 00:50:26.730 Louie: don't do that. 00:50:27.065 --> 00:50:31.235 Jon: That was another topic, that was brought up at a, at an event that 00:50:31.235 --> 00:50:34.365 Louis and I went to on Monday, where one of the firefighters was talking 00:50:34.365 --> 00:50:37.485 about like, man, you guys should really talk about sports betting and 00:50:37.485 --> 00:50:38.985 what's that like at the fire hall, 00:50:39.120 --> 00:50:41.550 Louie: We were like, we were like, Hey, we don't wanna lose our subscribers, 00:50:41.550 --> 00:50:44.280 man, if we start going after sports betting, there's gonna be a revolt. 00:50:44.280 --> 00:50:45.510 We'll get zero listeners. 00:50:45.510 --> 00:50:45.900 Exactly. 00:50:46.215 --> 00:50:47.085 Jon: exactly. 00:50:47.085 --> 00:50:50.175 But, no, thanks for the support guys and everyone out there. 00:50:50.175 --> 00:50:54.465 And, we'll, we'll be queuing up another episode here in the, in the near future. 00:50:54.465 --> 00:50:54.825 But, 00:50:54.875 --> 00:50:56.795 Louie: got big things coming too, so stay tuned. 00:50:57.320 --> 00:51:00.200 Jon: We do, we're not gonna quite let the cat out of the bag for this 00:51:00.200 --> 00:51:04.790 episode, but just know, in the near future, the fiscal firehouse is gonna 00:51:04.790 --> 00:51:05.840 have a little bit different feel. 00:51:05.890 --> 00:51:05.950 Yeah. 00:51:06.340 --> 00:51:06.940 All right. 00:51:07.010 --> 00:51:08.880 and we will just, we'll just leave it at that. 00:51:08.880 --> 00:51:09.300 So 00:51:09.635 --> 00:51:09.725 Louie: It's 00:51:09.900 --> 00:51:10.410 Jon: be good. 00:51:10.410 --> 00:51:11.070 It'll be good. 00:51:11.070 --> 00:51:11.100 It'll be good. 00:51:11.100 --> 00:51:12.720 So stay safe out there, everyone. 00:51:12.790 --> 00:51:13.750 thanks for listening. 00:51:13.935 --> 00:51:14.475 Louie: Keep saving. 00:51:16.437 --> 00:51:19.017 Disclosure: The Fiscal Firehouse Podcast is a podcast curated 00:51:19.017 --> 00:51:21.507 specifically for local 1309 members. 00:51:21.627 --> 00:51:25.317 This podcast is for informational and educational purposes only, 00:51:25.527 --> 00:51:28.437 and should not be construed as professional financial advice. 00:51:28.587 --> 00:51:31.317 Should you need professional advice, consult a licensed 00:51:31.437 --> 00:51:33.837 financial advisor or tax advisor. 00:51:34.017 --> 00:51:37.887 The opinions of John Beatty, Louis Barilla and their castmates are 00:51:37.887 --> 00:51:41.127 solely their own, and don't reflect that of West Metro Fire Rescue.