Ambulance,mcl (Photo credit: Wikipedia)

I don’t think my sister would appreciate me sharing this on the internet, but she’s in a financial bind and it’s because she doesn’t have an emergency fund. In the grand scheme of putting your family finances together, paying off debt is important, but an emergency fund is essential.

The Right Choice in a Difficult Situation

Have you ever turned someone down after they’ve asked you to be in their wedding? My sister hasn’t. She’s at that age where a couple of her friends are getting married every year and for some reason, none of these weddings can commence without my sister playing serious role. This year, she’s in two.

How does a wedding connect to the wallet? My sister has to buy dresses, shoes, alterations, bachelorette parties and wedding gifts. By the end of the day, her bank account is drained for months.

It’s particularly disappointing because she’s been working hard on debt reduction. She’s been paying off some outstanding credit card debt. Although she’s been persistent, these types of blessed events really put her in a bind.

Emergency Fund before Debt Reduction

If you haven’t guessed by my title, my suggestion was to set up an emergency fund. Her immediate reply was that all her extra money was going to pay down debt. However, you don’t have to give up paying down debt to start an emergency fund.

You can have two financial priorities at the same time. All you need to do is designate some portion of your debt payment to go to an emergency fund. I suggested to my sister that she do $25 per paycheck, because my sister didn’t have lots of extra money in her budget. It doesn’t sound like much, but it does add up, especially since it is money you hope you don’t have to use.

Benefits to an Emergency Fund

The best part of an emergency fund is that they provide all kinds of benefits.

• Allows you to take advantage of sudden opportunities
• Provides peace of mind knowing that you have money to cover emergencies
• Keeps you out of even more debt when emergencies arise
• Ensure that your regular debt reduction payments continue without interruption

I understand that these benefits may not be as motivating as paying off your debt. However, it will keep you from financial difficulty should you find yourself in two different weddings.

Blogging Goal Update

I forgot to do this last week, so I have two weeks of sharing instead of one.

I started the Yakezie Challenge about 5 weeks ago and so far things are going great, my alexa has fallen to a mere 260k, which is far lower than I ever would believe possible. While the challenge is to reach as low as 200,000, I’ve noticed that many of the Yakezie members have blogs below 100,000. Even if I reach the minimal challenge requirement, the true test of this blog will be whether it can reach as low as the top blogs on the web.

My big strategy has been in guest posting. In the last two weeks, I’ve submitted posts to From Shopping to Saving and Add Vodka. They both are publishing on the 4^th, so don’t be surprised when the web is plastered with my posts on Wednesday. I’m not trying to take over the internet, I’m just networking.

I also finished up an article I wanted to send to Sam and post on Yakezie. However, my wife fell asleep while reading it and gave it a thumbs down. My wife isn’t into personal finance blogs, which makes her a perfect, non-biased source of feedback for my writing. If it put her to sleep, it’s worth rewriting.

Guest Posts from Week of June 18^th

• From Shopping to Saving – Scheduled July 4^th
• US News and World Report – 5 College Degrees that aren’t Worth the Cost
• Steadfast Finances (staff post) – Things that Won’t Stop a Bank from Cashing a Check

Guest Posts from Week of June 25^th

• Add Vodka – Scheduled July 4^th

• US News and World Report –  Better Off Defaulting on your Mortgage or Financing with a Credit Card?

• Steadfast Finances (staff post) – Advice on Three Important Financial Decisions for Young Adults

Top Ten Family Finances Articles

You’ve been reading so patiently, so I’ll reward you with the links that you are dying to read this week. Last week there were a lot of excellent posts on family finances. I trouble deciding on just ten. So below is my best effort at narrowing the field.

1. Guest writer Alisa Weinstein has an article at Budgets are Sexy about paying children to do professional work, instead of chores.. I want to look into her methodology more and it might make a great post later.
2. Think of how much you spend on clothing, then realize that you are wearing glorified weaves of cotton balls. Free Money Wisdom has a great theory and practice on how to save money on shopping for cotton balls (I mean clothes).
3. Want a smart investing allocation, but don’t want to spend more than five minutes? Money Cone has a great tool. Five minutes and you’ll set up your investments for years.
4. Young and Thrifty embraces the boogeyman and talks about how great debt can be for investing. I’m not sure I’m willing to go sprinting toward debt, but it is a point often overlooked in the personal finance world. One that families should consider before eliminating debt that could be useful.
5. You children aren’t going to learn all of life’s lessons in school. Thirty Six Months talks about five lessons she learned from her mother.
6. The most important factor in the buying a home versus rent decision is determining if renting is the better option. Little House in the Valley reviews the buy to rent ratio and how it can be used to avoid making the wrong choice.
7. Speaking of emergency funds…which would you rather have: smartphone or emergency funds? My Journey to Millions discusses the choice that most people make.
8. It’s 2012, there’s more than one way to make free phone calls these days. Find out which free option comes with Big Brother attached at Prairie Eco-Thrifter.
9. Two people can buy the same car, but pay different prices. How does that happen? They get different interest rates on their auto loan. Find out how to improve your car loan interest rate at Money is the Root.
10. Is there a vacation you’ve always wanted to take, but could never afford? It’s easy to find the money to go on an expensive vacation if you follow Married with Debt’s vacation planning tips.

My Family Finances from All Over the Internet

I always pay back links with more linking. That’s why you should be linking to My Family Finances every week, day or minute.

• Lifestyle Carnival at Young, Cheap Living

• Y & T’s Weekend Ramblings at Young and Thrifty

• Carnival of MoneyPros at Simple Finance Blog

• Carnival of Fin. Camaraderie at The University of Money

• Carnival of Retirement at I Am 1 Percent

• Yakezie Carnival at One Cent At A Time

• Festival of Frugality at Help Me To Save

• Frugal Toad: Best Money Saving Tips – Cheap Travel

• The Free Financial Advisor: Blog Post of the Week!

• See Debt Run: Are Your Friends Smart With Money?

How am I doing? I’d love to hear from you in the comments.

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