South County Girl: 3 month emergency fund breakdown

Each year we take a look at our expenses and how they compare to our emergency fund. With fluctuating health insurance options and changing circumstances, it's always good to review where you stand each year to see if you need to add more to your EF as cost of living changes.

Our Current emergency fund is $16,700.00 -- all liquid in a savings account.

In the event of a double job loss, we would operate under a bare bones budget consisting of:

Heath Insurance (Purchased through Covered CA) Silver HMO Health Net for 2 adults, 1 kid: $680.49 a month
Mortgage/Taxes: $786.71 (no additional principal payments)
Gasoline: $230.00 (Drive to find jobs)
Eli Fund: $90 (Diapers/wipes, etc)
HOA: $350
Insurance: $167
Utilities: $150
Groceries: $333
Discretionary: $50 (always have a little padding)
Phones: $75
Car Reg: $25

$2,937.50... so call it $3K. We have removed Clothing, Christmas, Birthdays, and itemized savings because we would be pulling money out to live on. So naturally, more scratch cooking and more frugal methods would be put in place in actuality, but I like round numbers and this is all for estimating purposes. Essentially, we would have 5 months with a $1k buffer. I think in practical terms, we'd be able to go a full 6 months easily because we could pull from our itemized savings (like vacation), and our checking account padding to come up with another $3k.

If my husband were to loose his job, and I to keep mine, we would operate a modified budget which would not have us draw on our emergency fund at all. Yup, you read that right. We don't over extend ourselves with consumer debt or push ourselves with a mortgage we can't afford.

Our second income allows our lives to be more comfortable as we can pay extra on our mortgage, save a bit for retirement, and cover daycare and some small "perks" in our budget. We don't really feel "comfortable" with our incomes (as we are not in our forever home to say the least), but we are able to get by. We use our tax return and profit share checks from hubs job for larger purchases, which helps us feel less pinched during the year when wants exceed our monthly budget. But this strategy leaves our Emergency Fund for true emergencies. So much so, that we have not pulled from our emergency fund since before 2014 (as that's all the data records I have access to since we moved it from one bank to another).

We also wouldn't need health insurance through Covered CA because we take that from my work, and with a job loss, we would eliminate daycare temporarily to reduce expenses and use drop in/half rate for job interviews when they arose (paying for it with discretionary funds). So we won't have a line item for savings or as much pocket money or date night money, or the ability for overtime or cash to accelerate our mortgage, but we could survive and still put 9-10% in retirement.

Mortgage/Taxes: $786.71 (no additional principal payments)
Gasoline: $230.00
Eli Fund: $90 (Diapers/wipes, etc)
HOA: $350
Insurance: $167
Utilities: $150
Groceries: $333
Phones: $75
Car Reg: $25
Tithe: $426
Car Emergency: $100
Discretionary: $100
B-day/ Christmas: $100
Clothes: $52
Eating out: $45
Pocket Money $20 each / $40 total

Now, if I were to loose my job, we would move out of state and use our emergency fund to get us through while the condo sold. My work would also have to pay out my ample vacation hours, which are around 300 hours, giving my last paycheck a $7,000 BUMP before taxes... (Just saying...)

But we would take our bare bones budget approach and end up needing to pull $1650 out of savings each month since my husbands take home pay is around $1500 a month. At this rate, we'd have 11 months to sell our condo and re-locate... which should give him an opportunity to transfer his job from one state to another since they are a company with locations across the US so hopefully we'd move to a cheaper area, closer to family and one of us would have employment.