You forget an axe or a machete, just in case.
CHF 1,000 in CHF 20 banknotes âin an envelopeâ and EUR 500 in EUR 20 banknotes in case I need to cross the border and find opportunities abroad.
1 30L bag with food, water, warm clothes/blankets, medicine, soap, roll of toilet paper, roll of black trashcan bags, waterproof tarp and ropes, sleeping bag, sleeping mattress, batteries, duct tape, tools (knife and sharpener, saw, shovel), basic appliances (flashlight, water filter, firestarter, collapsable pot, becher, fork and spoon, solar battery charger, a few charging cables, pencils, a map of the area, an altimeter, a watch and a compass) and a printed copy of my identity card, driver license, insurance policies, CV and certificates) at home as a starter pack. No weapons/ammo (I donât want a weapon at home + we live in Switzerland, those will be plentiful in case of apocalypse).
My plan is to have more of those hidden in various spots outside, though I havenât started on that path yet.
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For me, that question doesnât make sense.
Itâs a little bit like with @Grog and @Yanikuza:
I have a portfolio with 80% stocks and 20% cash (for lack of useful alternatives in bonds).
Typical accumulation phase: Buying whenever i have the money, rebalanced on a regular schedule, hold for 10+years.
The major function of my emergency fund is to âdefendâ my portfolio = Never touch it. It amounts to approx. a year of expenses and is a little more than probably needed. As detailed in my post, I could improve more of that defense when push comes to shove.
For completeness: The emergency fund is not a significant part of my overall wealth (<10%), so it doesnât generate too much of a drag in terms of missed gains that I could otherwise realize get with stocks.
Cheers, J.
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Can you open a new thread about that if you think it could be nice to discuss?
I find it funny anyway that you have a bag with survival stuff and a CV on it 
I imagine you fightiing ina Jungle, getting out of it, clean yourself and give your CV in the next office you see (with Dwayne Johnsonâs smile)
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Iâm not sure I understand the aversion against selling off some stocks most folks here have, resp. why many see margin as primary way to deal with this.
In my mind, stocks are a liquid asset class that can be accessed when necessary. For short term access to cash it doesnât really hurt much to sell off a few stocks, at least if you accept that markets mostly follow a random walk pattern in that time frame. For the longer term you will probably miss out, but here your leverage / margin should be informed more by investment strategy in general and less by needing a new car.
If tapping into margin is such a great deal, why not do it all the time? Or if that sounds too risky, why take that risk when some other emergency just happened? Are you balancing your fear of missing out, with hoping that the market doesnât crash just when you had to tap margin?
As a thought, if you are so inclined, maybe tie the decision making process to market prices. E.g. if market prices are more than 20% below the all-time-high price: consider margin. If above, sell off some stocks. Or if CAPE < 20 / > 20?
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For the original question, my cash on the CH bank account is typically 7â500 - 8â000 CHF. Chosen somewhat arbitrarily, probably because I hate paying the bank account fee (Migros Bank waives the fee if above 7â500 CHF). At the recent dip in VT price I was happy to reduce this to 2â000 CHF.
Otherwise, my thoughts are:
- For very short term needs the credit card provides sufficient liquidity.
- Within 1-2 days notice I can also transfer cash from IB to the CH if necessary (selling some VT or I guess use margin, see post above).
- The credit card LSV date is shortly after the salary is on the account, if the extra cash requirement was not huge it would be sufficient to just not invest anything this month.
- In case I get fired, I have 3 months notice. At a current ~50% savings rate this will generate enough cash for 6 months and bridge to unemployment benefits.
- If I need to be on unemployment benefits, I currently qualify for 1.5 years @ 80% of previous salary. At our current spending levels this will gerenate enough cash for 2.5 years. Moving some stocks to more defensive / less volatile assets should be considered.
Maybe your needs are different if you have dealings with the Mafia and need to pay right now, or get kidnapped during your Afghanistan vacation. This suits me though and I still sleep well. Being on the path to FIRE means that I am more frugal and have more assets than my average peers, and therefore well placed to deal with stuff when it happens.
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I hold around 10-20k CHF in cash and can sleep tightly knowing I can get 150k+ CHF margin loan out of IBKR within 1-2 business days.
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I hold 10 k as EF ⊠I sleep well because I have more than 2 years of experience in Geneva and in the same company so I could get social benefit under 3 months if needed.
My wife is also 100% cash excluded 3rd pillar.
I could not get her to invest much.
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The whole purpose of emergency fund is to be able to sleep well irrespective of unexpected financial hits you get! Having a family, I have doubled down on death and disability insurances and 1 year of expenses in bank account.
Being in a bad job right now, I see the emergency fund giving me an option to walk away even if I donât get unemployment for first few months or take a lower paying job if that seems better for well being of myself and family.
On the other hand, I have my entire portfolio in globally diversified small cap value. So the swings in portfolio value are high to say the least.
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I see, nobody is living from paycheck to paycheck in hereâŠ
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I used to. No later than January last year, I had to resort to credit card use to finance expenses I couldnât cashflow (I paid it off the month after). That one was self-inflicted since I had big elective training fees until last December. The years before were worse and there wasnât much I could do but lower my expenses and pay off the student debt that was strangling me. Discretionary expenses, dating (not mentioning considering having children) and travel were out of the question.
I now have a good cashflow and positive balance at the end of the month so the sacrifices paid off. What was the point of this remark?
I agree with @Wolverine . There is no merit in spending everything you earn, there is no shame in saving money. And it is not a question of how much you earn and how much you own. It is a matter of financial discipline and planning.
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No offense to anyoneâŠ
I lived from paycheck to paycheck once. And kept going after I havenât to.
I put everything what remains from a paycheck in crypto (or I did years ago in my favorite stocks etc). When I need some more cash as usual , I take it from the crypto (and before that sold some stocks).
There is no point in having cash lying useless around.
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Iâm living from paycheck to paychech since march 2022, for reason that I canât control unfortunately. Iâm currently not investing as I canât do it for now, and maybe for the rest of this years because I will earn less starting form July (this one on purpose for the future).
As said before, Iâm glad to have a confortable cushion of cashfor the upcoming months and hope that 2023 will be better with all sacrifices that Iâm doing
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That would be like 10k?
Same. I have about 1000⏠in physical cash. And a couple hundreds on accounts here and there. The savings for health insurance and taxes I donât really consider safety margin - cause I need the,.
Well I do as my EF is currently 0 and this wonât change till February 2023.
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Sorry for my reaction. I think we donât use âpaycheck to paycheckâ with the same meaning. To me, that means the incoming cashflow is eaten in whole by the outflows and there is no remainder to put away (be it when the salary is received by paying ourselves first or after all expenses to store away what remains). Iâd say the stress isnât the same if thereâs a positive cashflow but it gets voluntarily taken away for personal savings/investing.
I may still understand you wrongly and what you are talking of by voluntarily living paycheck to paycheck is rather taking a lower stress, potentially part-time job which just covers your expenses, so thereâs nothing to stash away. In which case, the concept has merits. Itâs cashing on frugality now rather than later.
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somehting like this:
I replace the water every year - mostly in a very hot day in summer I will bring the kanister out from the cave into the garden, let the kid play with the water, clean it a bit in the evening and put it back with fresh water in the cave.
Which is actually cool because we canât use the water valve for playing purposes in our garden - a bit sad but it is what it is.
Did you ever try it after one year? If you would like to prepare for a event where you need it I recommend to change it more often and not to store your whole reserve in the same container.
When you fill tap water in this container which you âclean a bitâ the water wont be stable as long as water purchased in bottles or even glas bottles.
Best way to keep emergency food/drink is to take things you use regularly. You could buy 40lt sparkling water and then actually use it and purchase a new sixpack as soon as you finished one.
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