Sunday, December 30, 2012

Importance of having personal Emergency and Opportunity Funds

Today is the last day of year 2012. I am happy to note that I managed to build up my personal Emergency Fund that allows me and my family to survive without my income for six months. It took me more than two years to save up this amount of money. This is because I had used up all my personal savings for my wedding last year. In addition, I am also the sole-breadwinner, had a baby girl and owns a car. Therefore, it took me quite some time to save up this amount of money. My partner and myself decided that we would only dip into fund when I lost my job or faced a personal finance crisis. Henceforth, we put the fund into a fixed deposit.

I always encourage young people who just entered the workforce to build up their Emergency Fund as soon as possible. Life is always unpredictable. You never know when you will lose your job or encounter personal finance crisis. Having an emergency fund can help to provide short term security against market uncertainties. It allows you and your family to carry on life as per normal whilst you embark on the recovery journey. Without this sum of money as interim support, you have no choice but to borrow from friends and relatives. Personally, I don't like to, and have yet, to borrow from my friends and relatives.

Of course, having this Emergency Fund is only one of the key elements of my personal finance. It would not help to enhance my wealth nor elevate me to another wealth level. To me, it is just another "shield" or protection for personal finance. My next course of action is to build up my Opportunity Fund - war chest for investments and business opportunities. I am confident that this Opportunity Fund can be built up in March next year. However, I believe the short term market condition is not conducive for investing. My belief is only to invest during crisis times.  In the mean time, I am compiling research on some of the stocks and other form of investments in this blog. Stay tune for more updates!

Magically yours


  1. It's great to hear that you've managed to saved enough for rainy day. As for your Opportunity fund, how much would you be targeting?

  2. Hi, I am starting small. So my target is to build a war chest of SGD50,000. I will only invest during crisis times.

  3. Having a six month emergency fund is so important. I was in a car accident and it really came in handy. Now we are trying to save again so we have one for the future.

    1. How you are okay now.