The following is an anonymous post in the Facebook group Asan Ideas for Wealth (AIFW) reproduced here after its admin, Ashal Jauhari’s suggestion.
“A real-life example to prove that there are only two kinds of people – those who have faced emergencies and those who have not. In the example below, this old friend – an AIFW member – freefincal reader was serious enough to hold an emergency fund” – Ashal.
Dear Ashal Bhai, would you please share this post in the group on my behalf? It contains personal details, so I want to post it anonymously. Over the years in AIFW, a lot has been discussed about the importance of having an Emergency Fund. Ashal Jauhari has made countless posts/comments on it. Pattabiraman Murari has written several articles about it on freefincal.com. This is an account of my personal experience.
Around four months back, my mother was hospitalised with acute stomach pain. Shortly, the doctors had to perform an emergency surgery. And a few days later, she was diagnosed with colon cancer, stage IV, not curable, terminal. She was at the hospital for about one month. After discharge, she was at home for around three months. She passed away three weeks back.
She had sufficient health insurance, which covered most of the hospitalization bill. Given the prognosis, we consulted multiple oncologists from across the country. They advised some more cancer-related diagnostic tests that were quite costly. We also got second opinions from two of the world’s top cancer hospitals: New York and Seoul.
Join 32,000+ readers and get free money management solutions delivered to your inbox! Subscribe to get posts via email! (Link takes you to our email sign-up form)
🔥Enjoy massive discounts on our robo-advisory tool & courses! 🔥
Those opinions came attached with a very high price tag. Due to the surgery, she required weekly dressings that had to be done by a specialist and supported by several surgical items. A doctor specializing in palliative medicine visited her regularly at home and prescribed medicines to manage the many symptoms caused by cancer.
Provisions were made for oxygen support at home, along with several other kinds of medical and non-medical arrangements. And no insurance covered the cost of *any* of those things.
But cost/insurance/money was the least of my worries during that period. The only things that mattered were what can I do to provide the best available treatment for my mother, how can I ease her pain and suffering as much as possible, and how can I provide her with the best possible care.
I could afford not to worry about money because, at the back of my mind, I knew I had a sufficiently large Emergency Fund to cover everything coming our way. Even though I was not necessarily using that fund right away. I was not in a mental state, nor had the time, to redeem from this mutual fund, break that fixed deposit, or do something else to a similar effect.
In fact, I had paused all my investments. Because such things simply no longer seemed important enough at that time. I knew all of those could be sorted out later. The only thing that I continued to do was pay my credit card bills on time. I’d read this somewhere: during a real emergency, every fund is an emergency fund (probably in freefincal.com, but maybe not in those words). They could not have been more true. Editor’s note – probably this post: Can you handle it when your entire wealth becomes an emergency fund? Also, see: What they don’t tell you about the emergency fund!
I had always imagined that the Emergency Fund would be what I’d be using *during* an emergency – sweep fixed deposits, liquid funds, etc. What had never occurred to me was that it could serve another purpose also. Become the source of a huge psychological relief, that I need not worry about money when money is needed the most, that I can afford to completely focus on the actual reasons why money is needed and not on the supply of money itself.
The previous sentence may seem confusing, particularly to those who have not yet faced a real emergency in life, especially a critical medical one. But, after having gone through such an experience, I found that realization to be profoundly significant.
Of course, each one of our circumstances is different, as are our experiences and ways of dealing with life. But regarding the financial aspects, nothing compares to being prepared to face an emergency. Nothing! That’s why in the BASICs (see the Featured section of this group), the first three points are all related to life’s emergencies. Everything else comes later.
🔥Enjoy massive discounts on our courses, robo-advisory tool and exclusive investor circle! 🔥& join our community of 7000+ users!
Use our Robo-advisory Tool for a start-to-finish financial plan! ⇐ More than 2,500 investors and advisors use this!
Track your mutual funds and stock investments with this Google Sheet!
We also publish monthly equity mutual funds, debt and hybrid mutual funds, index funds and ETF screeners and momentum, low-volatility stock screeners.
- Do you have a comment about the above article? Reach out to us on Twitter: @freefincal or @pattufreefincal
- Have a question? Subscribe to our newsletter using the form below.
- Hit 'reply' to any email from us! We do not offer personalized investment advice. We can write a detailed article without mentioning your name if you have a generic question.
Join 32,000+ readers and get free money management solutions delivered to your inbox! Subscribe to get posts via email! (Link takes you to our email sign-up form)
About The Author
Dr M. Pattabiraman(PhD) is the founder, managing editor and primary author of freefincal. He is an associate professor at the Indian Institute of Technology, Madras. He has over ten years of experience publishing news analysis, research and financial product development. Connect with him via Twitter(X), Linkedin, or YouTube. Pattabiraman has co-authored three print books: (1) You can be rich too with goal-based investing (CNBC TV18) for DIY investors. (2) Gamechanger for young earners. (3) Chinchu Gets a Superpower! for kids. He has also written seven other free e-books on various money management topics. He is a patron and co-founder of “Fee-only India,” an organisation promoting unbiased, commission-free investment advice.Our flagship course! Learn to manage your portfolio like a pro to achieve your goals regardless of market conditions! ⇐ More than 3,000 investors and advisors are part of our exclusive community! Get clarity on how to plan for your goals and achieve the necessary corpus no matter the market condition is!! Watch the first lecture for free! One-time payment! No recurring fees! Life-long access to videos! Reduce fear, uncertainty and doubt while investing! Learn how to plan for your goals before and after retirement with confidence.
Our new course! Increase your income by getting people to pay for your skills! ⇐ More than 700 salaried employees, entrepreneurs and financial advisors are part of our exclusive community! Learn how to get people to pay for your skills! Whether you are a professional or small business owner who wants more clients via online visibility or a salaried person wanting a side income or passive income, we will show you how to achieve this by showcasing your skills and building a community that trusts and pays you! (watch 1st lecture for free). One-time payment! No recurring fees! Life-long access to videos!
Our new book for kids: “Chinchu Gets a Superpower!” is now available!
Must-read book even for adults! This is something that every parent should teach their kids right from their young age. The importance of money management and decision making based on their wants and needs. Very nicely written in simple terms. - Arun.Buy the book: Chinchu gets a superpower for your child!
How to profit from content writing: Our new ebook is for those interested in getting side income via content writing. It is available at a 50% discount for Rs. 500 only!
Do you want to check if the market is overvalued or undervalued? Use our market valuation tool (it will work with any index!), or get the Tactical Buy/Sell timing tool!
We publish monthly mutual fund screeners and momentum, low-volatility stock screeners.
About freefincal & its content policy. Freefincal is a News Media Organization dedicated to providing original analysis, reports, reviews and insights on mutual funds, stocks, investing, retirement and personal finance developments. We do so without conflict of interest and bias. Follow us on Google News. Freefincal serves more than three million readers a year (5 million page views) with articles based only on factual information and detailed analysis by its authors. All statements made will be verified with credible and knowledgeable sources before publication. Freefincal does not publish paid articles, promotions, PR, satire or opinions without data. All opinions will be inferences backed by verifiable, reproducible evidence/data. Contact information: letters {at} freefincal {dot} com (sponsored posts or paid collaborations will not be entertained)
Connect with us on social media
- Twitter @freefincal
- Subscribe to our YouTube Videos
- Posts feed via Feedburner.
Our publications
You Can Be Rich Too with Goal-Based Investing
Published by CNBC TV18, this book is meant to help you ask the right questions and seek the correct answers, and since it comes with nine online calculators, you can also create custom solutions for your lifestyle! Get it now.Gamechanger: Forget Startups, Join Corporate & Still Live the Rich Life You Want
This book is meant for young earners to get their basics right from day one! It will also help you travel to exotic places at a low cost! Get it or gift it to a young earner.Your Ultimate Guide to Travel
This is an in-depth dive into vacation planning, finding cheap flights, budget accommodation, what to do when travelling, and how travelling slowly is better financially and psychologically, with links to the web pages and hand-holding at every step. Get the pdf for Rs 300 (instant download)