Emergency Fund - How Much?

[BrettGC]

Hi Guys,

 

In your minds, how much do you think is a "safe" amount for an emergency fund once living there permanently?  Something that covers medical, urgent trips back to country of origin etc.  Both Aines and I are in good health, both our families are too.

 

I'm talking an amount of money that's never touched barring exceptional circumstances.

 

I know it's very dependent on income so I'll let you know my situation:  My Navy pension is approx 80k PHP post-tax a month (taking into account the vagaries of  the AUD's flucuation) and Aines' income is just a little bit higher than that.  The advent of the military retiree visa encompassing Australians has made a huge difference in my calculations but would still like some "on-the-ground" advice.  I'll probably end up on a 13A eventually but that's a topic for another thread. 

 

Edit: Short Angry One has been slapping me around since she arrived here yesterday saying I'm being too conservative!

Edited April 7, 2014 by BrettGC

[JJReyes]

Hi Brett,

 

Let me know once you receive the Courtesy visa for military retirees. Send me a PM because I will be on the road. I have reserved the domain name "www.retiredwarriors.com" to post information for other who might be interest.

 

My emergency fund is six months the monthly expenses. Some claim it should be only three months, but I am a bit of a fiscal conservative. 

[BrettGC]

I'd rather err on the side of caution too JJ.  Haven't even started the application process for the visa yet, will be a while.

[Tukaram (Tim)]

My emergency fund is my American credit cards.  I have no real savings... but I am the poster child of how not to retire overseas ha ha.  But I have have nothing on my credit cards and I forget... but $25,000-$30,000 available.  But I need to start using them again (and paying off immediately).  My credit score just dropped a little, from inactivity.

[jon1]

If you can afford it, I agree with JJ. 6 months is a decent objective. I would also maintain a credit card with a minimum of  $10,000 available, preferrably $20,000 or more. That way if you do get hospitilized you have a method of paying. I had a hospital stay 4 years ago that cost me $10,000 (a one week stay with private room, surgery, etc. at St Lukes in Manila).

[Mike S]

My emergency fund is my American credit cards.  I have no real savings... but I am the poster child of how not to retire overseas ha ha.  But I have have nothing on my credit cards and I forget... but $25,000-$30,000 available.  But I need to start using them again (and paying off immediately).  My credit score just dropped a little, from inactivity.

 

Mine dropped a whole lot when I came here I had $30,000 (but I was also working then) .... it is now $5000 .... it went down by 50% when I retired and has gone down each year to finally $5000 for the past 4 years .... but then I have never asked for them to up it and I only use it a couple of times a year to keep it open .... pay off each purchase with in 2 weeks of making them .... my credit rating has gone to sh*t because I charge nothing for the past 6 years and owe no one .... but I like it that way .... and $5000 ....  p222500 will at least help me out of a jam .... but then I also have a small nest egg salted away just in case ..... :thumbsup:

:cheersty:

[davewe]

My emergency fund is my American credit cards.  I have no real savings... but I am the poster child of how not to retire overseas ha ha.  But I have have nothing on my credit cards and I forget... but $25,000-$30,000 available.  But I need to start using them again (and paying off immediately).  My credit score just dropped a little, from inactivity.

But am I correct that if you had a medical emergency you would need cash. As I recall an ATM or credit card withdrawal maximum is kinda small. So in addition to having money in the bank, and credit if you need it, don't you need an actual emergency cash fund? Or am I overstating hospitals cash requirements?

Edited April 7, 2014 by davewe

[MikeB]

Depends where you are. In my experience, large hospitals take major credit and debit cards, small provincial hospitals may not. The one in our town does not, or didn't 2 years ago when I asked. But if your condition is serious or life-threatening they would be a stop gap until you were transferred to a larger facility. All hospitals, public or private, are required by law to treat you on an emergency basis if your condition is serious. 

[BrettGC]

Well I don't do credit cards, ever.  Haven't since my divorce in '99.  With the advent of Visa/Mastercard debit I haven't had the need.  I've either saved for stuff (remember when we all used to do that) or just don't bother.  Hell, i haven't even had a bank loan for years other than my investment property in Sydney. There is the issue of maximum daily limits to consider though.  That leads me to the question:  Are cheques widely accepted in PI?  Here in Australia they haven't been for some years - most merchants don't even bother with the sign "no cheques accepted except by prior arrangement" anymore as it's a given.  I know when operating at a wholesale business level they're still very occasionally  used here, and last time I lived in the US (2008-10) they were still widely used but what about PI?

 

The next question is what happens if you deplete the emergency fund due to, well, emergencies?  Reduced retirement income does make it harder to save?  Hmmm, answers the credit card question.

[Tukaram (Tim)]

 

My emergency fund is my American credit cards.  I have no real savings... but I am the poster child of how not to retire overseas ha ha.  But I have have nothing on my credit cards and I forget... but $25,000-$30,000 available.  But I need to start using them again (and paying off immediately).  My credit score just dropped a little, from inactivity.

But am I correct that if you had a medical emergency you would need cash. As I recall an ATM or credit card withdrawal maximum is kinda small. So in addition to having money in the bank, and credit if you need it, don't you need an actual emergency cash fund? Or am I overstating hospitals cash requirements?

 

 

Most places here accept credit cards.  But I am old and don't worry about medical.  If i was really concerned about health care I would have stayed in the US where I got good care for free (Veterans hospital).  I am sure I am trading some quantity of my life to improve the quality of my life. 

 

But of course... after I moved here my health improved... who expected that?   I really don't care, though.  I know I have more days behind me than ahead of me - so I am here to enjoy what I get.