Dear Dave: My wife and I are on Baby Step 3 of your plan. When we have standard car repairs, I want to use the emergency fund. She says that kind of thing isn’t an emergency, and we should just put it off as long as possible while saving up to fix the problem. Who’s right?
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Dear Ryan: Sorry, you’re both wrong. Cars break. And since no one will invent one that lasts forever and doesn’t break down, standard car repairs shouldn’t be viewed as an emergency. Maintenance and repair of your vehicles are an ongoing expense. It’s just part of owning them. That means you should have a category in your monthly budget for this sort of thing.
Now, an engine blowing up or the transmission going out would be an emergency. Hopefully, you’re not talking about something of this magnitude. But you’ve got to rework your budget to where you have something designated each month for car maintenance and repair. That way, you won’t be dipping into your emergency fund just to cover the basic wear and tear that comes with owning a car.
Take the next step today, and adequately fund this area so it doesn’t continually come back to bite you in the wallet and sabotage your emergency fund!
Dave’s latest project, EveryDollar, provides a free online budget tool. Follow Dave on Twitter at @DaveRamsey and on the web at daveramsey.com.