# How many people have at least three paychecks saved in case something goes wrong? **URL:** \ **Category:** In My Humble Opinion\ **Created:** [November 12, 2013, 7:02pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742 "2013-11-12T19:02:15Z")\ **Posts on this page:** 20\ **Page:** 1
**Author:** ![Mr\_Quatro](https://avatars.discourse-cdn.com/v4/letter/m/bc8723/32.png) [@Mr\_Quatro](https://boards.straightdope.com/u/Mr_Quatro)\ **Post date:** [November 12, 2013, 7:02pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/1 "2013-11-12T19:02:15Z")
Note: In the bank or under your mattress either way is acceptable. Question #1 How many people have at least three paychecks saved in case something goes wrong? Question #2 How many people don’t have three paychecks saved back and wish they did? Question #3 How many people live paycheck to paycheck and pay your bills, but have a hard time making ends meet and if something went wrong, as it sometimes does, you would have to pay the pawn shop a visit. ---
**Author:** ![Roderick\_Femm](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/roderick_femm/32/14875_2.png) [@Roderick\_Femm](https://boards.straightdope.com/u/Roderick_Femm)\ **Post date:** [November 12, 2013, 7:08pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/2 "2013-11-12T19:08:49Z")
I’m ok if I don’t have to have access to it within 2 hours. I’m old enough that I can withdraw from my 401(k) without penalty (if I understand this correctly), and I have some easily convertible investments. But it would take a couple of days minimum to get to it. So overall way over 3 paychecks saved for emergencies. Roddy ---
**Author:** ![Algher](https://avatars.discourse-cdn.com/v4/letter/a/3d9bf3/32.png) [@Algher](https://boards.straightdope.com/u/Algher)\ **Post date:** [November 12, 2013, 7:12pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/3 "2013-11-12T19:12:22Z")
I answered that I have the backup - but there is nuance. I run “hand to mouth”, but that is because I max out my retirement savings and I overpay mortgage when I have spare cash. So I don’t have 3 checks stashed, but I could cancel a stack of services and payments overnight plus tap into a home equity line of credit if needed. Keeping large amounts of cash around making minimal returns is not my idea of a good time. Being able to tap into a line of credit in case of a emergency (or losing a job) - that works. ---
**Author:** ![Dewey\_Finn](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dewey_finn/32/4222_2.png) [@Dewey\_Finn](https://boards.straightdope.com/u/Dewey_Finn)\ **Post date:** [November 12, 2013, 7:26pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/4 "2013-11-12T19:26:35Z")
I _had_ three paychecks saved, but my employer got mad at me for not cashing them, so I had to deposit them instead. ---
**Author:** ![CatherineZeta](https://avatars.discourse-cdn.com/v4/letter/c/e95f7d/32.png) [@CatherineZeta](https://boards.straightdope.com/u/CatherineZeta)\ **Post date:** [November 12, 2013, 7:39pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/5 "2013-11-12T19:39:49Z")
My clumsy fingers selected the wrong option (I’m posting from my phone). I don’t have three paychecks saved, but I’m not living hand to mouth either. I make enough to put a little in savings, but then something will come up and I’ll borrow from my savings, but never so much that my savings account hits zero. I have a small but growing 401k that I could also borrow from in a worst case scenario. I’m working on managing my money better. ---
**Author:** ![Debaser](https://avatars.discourse-cdn.com/v4/letter/d/3da27b/32.png) [@Debaser](https://boards.straightdope.com/u/Debaser)\ **Post date:** [November 12, 2013, 7:47pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/6 "2013-11-12T19:47:54Z")
Does the answer to #1 only mean cash? What if you stockpile your vacation time so you always have four weeks saved? How about if you have a credit card with room on it? There are other ways to prepare for an emergency than just cash. You could always put it in an IRA and then withdraw it without penalty if you need it, for instance. (But not any gains.) ---
**Author:** ![Jophiel](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/jophiel/32/66_2.png) [@Jophiel](https://boards.straightdope.com/u/Jophiel)\ **Post date:** [November 12, 2013, 7:58pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/7 "2013-11-12T19:58:03Z")
We have approximately six months worth of mortgage payments in the bank. The assumption being that the other person’s paychecks would cover utilities, food, etc and the non-working person’s unemployment could probably stretch the savings into eight months or more of mortgage payments. That’s just an unemployment scenario, of course. We’d have to dip into it if a car completely broke down, a big medical issue came up, etc. But at least there’s something there. ---
**Author:** ![Morgenstern](https://avatars.discourse-cdn.com/v4/letter/m/f9ae1b/32.png) [@Morgenstern](https://boards.straightdope.com/u/Morgenstern)\ **Post date:** [November 12, 2013, 7:58pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/8 "2013-11-12T19:58:14Z")
> [@Debaser](#): > > … How about if you have a credit card with room on it? > > … Using a CC for necessaries of life does nothing more than compound the problem. If you couldn’t afford it this month, how are you going to afford it next month plus pay the CC payment? ---
**Author:** ![Anaamika](https://avatars.discourse-cdn.com/v4/letter/a/5f9b8f/32.png) [@Anaamika](https://boards.straightdope.com/u/Anaamika)\ **Post date:** [November 12, 2013, 7:59pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/9 "2013-11-12T19:59:03Z")
I have changed a lot since my twenties. - I have over two months’ salary - which is four paychecks - squirreled away in a savings account, and I add to it every paycheck. - About five times that in a 401K, so almost a year’s salary. But I still have to pay to get this out, I think. - About a months’ salary at all times in my checkings account. - And of course a credit card. That’s just my salary…my SO also has about a month of HIS salary in the checkings, and about two months of his salary in his own personal savings, plus his 401K, and he has a much larger limit on his credit cards (I only got mine a couple of years ago.) In my twenties I don’t think I could rightly point to any of this. But it’s true what they say, even though I have a significantly comfortable cushion, it doesn’t feel like anywhere enough. A major surgery or prolonged illness could still break us. But at least every car repair doesn’t make us sob. ---
**Author:** ![harmonicamoon](https://avatars.discourse-cdn.com/v4/letter/h/65b543/32.png) [@harmonicamoon](https://boards.straightdope.com/u/harmonicamoon)\ **Post date:** [November 12, 2013, 8:05pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/10 "2013-11-12T20:05:38Z")
I was laid off once and had a family and no money saved. I thought, if I had planned for this event I would be on vacation enjoying the time off. Instead I was frantic. Learned my lesson. Once back to work, I began a saving program. Next lay off was, “pack the car, we are going camping”! ---
**Author:** ![Dangerosa](https://avatars.discourse-cdn.com/v4/letter/d/22d042/32.png) [@Dangerosa](https://boards.straightdope.com/u/Dangerosa)\ **Post date:** [November 12, 2013, 8:32pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/11 "2013-11-12T20:32:33Z")
two and a half years of paychecks saved, not dipping into college accounts or 401ks. I’m working on saving enough to retire early - and I “retired” last Spring (but will likely go back to work in a year or so), my husband still works. ---
**Author:** ![Anaamika](https://avatars.discourse-cdn.com/v4/letter/a/5f9b8f/32.png) [@Anaamika](https://boards.straightdope.com/u/Anaamika)\ **Post date:** [November 12, 2013, 8:38pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/12 "2013-11-12T20:38:16Z")
> [@Dangerosa](#): > > two and a half years of paychecks saved, not dipping into college accounts or 401ks. I’m working on saving enough to retire early - and I “retired” last Spring (but will likely go back to work in a year or so), my husband still works. This is where I need to be. ☹ Will keep working hard. ---
**Author:** ![dracoi](https://avatars.discourse-cdn.com/v4/letter/d/90db22/32.png) [@dracoi](https://boards.straightdope.com/u/dracoi)\ **Post date:** [November 12, 2013, 8:40pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/13 "2013-11-12T20:40:20Z")
> [@Morgenstern](#): > > Using a CC for necessaries of life does nothing more than compound the problem. If you couldn’t afford it this month, how are you going to afford it next month plus pay the CC payment? That’s not necessarily the case. For example: you’re putting $50 a month into savings, and you only have $500 in there when your furnace explodes for a $2500 repair bill, you can put the other $2000 on the card, then plow your $50/month onto the card for the next few years. Assuming that you have this kind of emergency every five years, this is a viable strategy, though less than ideal. However, I do want to remind people about 2008. I know I’m not alone in being a person who counted on credit cards in an emergency only to have the banks cancel every unused bit of credit as they responded to the financial crisis. So just when I needed the credit the most, it went away. My take-away lesson from that is to have six months of expenses in liquid assets at all times. ---
**Author:** ![HoneyBadgerDC](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/honeybadgerdc/32/1033_2.png) [@HoneyBadgerDC](https://boards.straightdope.com/u/HoneyBadgerDC)\ **Post date:** [November 12, 2013, 8:40pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/14 "2013-11-12T20:40:58Z")
When I was forty I lost everything but my home equity and was living hand to mouth. I am recently retired and live a simple life but could stretch 5 years out with no income if I had to. I plan to work that down to about 1 year by the time I am 80. I figure once I hit my 70’s it is hit or miss on how active I will be. My current income covers my expenses plus a small saving if I choose to save it. I have been tapping into my saving for the past year for extras. ---
**Author:** ![thelurkinghorror](https://avatars.discourse-cdn.com/v4/letter/t/7c8e57/32.png) [@thelurkinghorror](https://boards.straightdope.com/u/thelurkinghorror)\ **Post date:** [November 12, 2013, 8:42pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/15 "2013-11-12T20:42:35Z")
In savings? No. I have some in savings that is technically a stashed student loan, and in an emergency I could sell stock, which is about 3x my income (I have a low income). But none of this was intentional per se, and socking away part of each paycheck will be hard. I expect a drastic pay cut ($0 unless I find something) in January. ETA: :smack: oh, yeah I get paid monthly, so 3 paychecks is easier to attain than my original assumption, assuming paid every fortnight/26 payments per year, which I believe is most common. ---
**Author:** ![Mk\_VII](https://avatars.discourse-cdn.com/v4/letter/m/5f9b8f/32.png) [@Mk\_VII](https://boards.straightdope.com/u/Mk_VII)\ **Post date:** [November 12, 2013, 8:44pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/16 "2013-11-12T20:44:36Z")
A man I knew had his employers write to him, saying would he please cash his pay cheques within six months because it was complicating their accounts. ---
**Author:** ![Machine\_Elf](https://avatars.discourse-cdn.com/v4/letter/m/82dd89/32.png) [@Machine\_Elf](https://boards.straightdope.com/u/Machine_Elf)\ **Post date:** [November 12, 2013, 8:48pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/17 "2013-11-12T20:48:21Z")
My wife and I are in our early 40’s. For us, the line between “retirement” and “emergency” savings is a bit blurry. We’re dumping as much money as possible into our employers’ tax-deferred retirement plans, but we also have substantial after-tax investments that we are intending for retirement, but could be used right now in an emergency; those other investments (plus the cash in our checking/savings accounts) are enough for 11 years of mortage payments. ---
**Author:** ![Fuzzy\_Dunlop](https://avatars.discourse-cdn.com/v4/letter/f/848f3c/32.png) [@Fuzzy\_Dunlop](https://boards.straightdope.com/u/Fuzzy_Dunlop)\ **Post date:** [November 12, 2013, 8:50pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/18 "2013-11-12T20:50:05Z")
> [@dracoi](#): > > That’s not necessarily the case. For example: you’re putting $50 a month into savings, and you only have $500 in there when your furnace explodes for a $2500 repair bill, you can put the other $2000 on the card, then plow your $50/month onto the card for the next few years. Assuming that you have this kind of emergency every five years, this is a viable strategy, though less than ideal. > > However, I do want to remind people about 2008. I know I’m not alone in being a person who counted on credit cards in an emergency only to have the banks cancel every unused bit of credit as they responded to the financial crisis. So just when I needed the credit the most, it went away. My take-away lesson from that is to have six months of expenses in liquid assets at all times. I agree with \*\*Morgenstern \*\*. Anyone who has been in a tight spot financially knows it can be comforting to have thousands of dollars available on their credit card - but thinking of that as your ‘ideal’ emergency fund is folly. I might charge a large unexpected expense to my credit card planning to pay it off later that month, but that’s just using the credit card to manage cashflow. I don`t like to dip into my emergency savings to pay of an unexpected expense if I can just pay it off in a few weeks. But “I’ll just charge up 6 months living expenses to my credit card if I ever lose my job” is not a responsible emergency plan. ---
**Author:** ![Dangerosa](https://avatars.discourse-cdn.com/v4/letter/d/22d042/32.png) [@Dangerosa](https://boards.straightdope.com/u/Dangerosa)\ **Post date:** [November 12, 2013, 9:18pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/19 "2013-11-12T21:18:06Z")
> [@Anaamika](#): > > This is where I need to be. ☹ Will keep working hard. I have a few years on you. ---
**Author:** ![Anaamika](https://avatars.discourse-cdn.com/v4/letter/a/5f9b8f/32.png) [@Anaamika](https://boards.straightdope.com/u/Anaamika)\ **Post date:** [November 12, 2013, 9:20pm UTC](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742/20 "2013-11-12T21:20:05Z")
> [@Dangerosa](#): > > I have a few years on you. At least that gives me some time, love. 🙂 Well, _crosses fingers_ when I graduate next year I hope to land a better-paying job. Am majoring in IS, and trust me, even a low-level peon position in that field will pay more than being a glorified secretary, which is what I am now. So I should be able to sock away even more. And I’m not even 40 yet…so I still have time to save, save, save! I wish to god I had been more responsible in my twenties. It’s kind of depressing even to say that, isn’t it? But you can’t turn back time and I can only look forwards. [Next page](https://boards.straightdope.com/t/how-many-people-have-at-least-three-paychecks-saved-in-case-something-goes-wrong/673742.md?page=2)