Dear Dave,
My husband works construction, so we barely scrape by during the winter months. Should we build an emergency fund for the slow times?
Cathy
Dear Cathy,
I think that’s a great idea. Although, I’d probably call it something other than an emergency fund. How about a squirrel fund? Squirrels need to have nuts saved up for winter, and in your case you’d be setting money aside during the summer to get you through the slow winter months.
You may think I’m playing games with the name, but really I’m not. This sort of saving isn’t for emergencies. It’s a budget issue, because you’re planning and setting aside cash leading up to the down time you know is coming. Keep your emergency fund of three to six months of expenses separate from this, and take a careful look at what he made this winter and how much that left you short each month.
Remember, we’re not talking about some random amount of money here. It’s an exact amount that you can budget for accordingly. Teachers can do the same thing if they’re not paid 12 months a year. It’s a simple matter of planning ahead for the down time, and setting aside enough during the other nine months to see you through!
—Dave
* Dave Ramsey is America’s trusted voice on money and business. He’s authored four New York Times best-selling books: Financial Peace, More Than Enough, The Total Money Makeover and EntreLeadership. The Dave Ramsey Show is heard by more than 6 million listeners each week on more than 500 radio stations. Follow Dave on Twitter at @DaveRamsey and on the web at daveramsey.com.