One of the most popular posts on this site? How I Saved $13,000 For Travel In Just Seven Months.
I stand by that post. It may have been from a different point in my life, but it’s still an excellent guide on how to strip your life down to the basics in order to save a ton of money as quickly as possible.
Here’s the truth: saving that way is not sustainable as a long-term life strategy. I was working around the clock, eating almost nothing, sleeping four hours a night, and would have burned out had I lived like that for much longer.
A few days ago, The Billfold published a post about the importance of an emergency fund and called it A Story of a Fuck-Off Fund. Shortly after, Jezebel wrote a great response which I shared on the Adventurous Kate Facebook page, and it became one of my most-shared links of all time.
That post was fantastic. The importance of having an emergency fund can never be overstated, and calling it a Fuck-Off Fund is a way that makes it sound, well, empowering and fun!
At the same time, I felt that the specific story that it told — of a woman whose boyfriend began hitting her and whose boss began groping her — was an extreme example of what can push you to need an emergency fund to escape. It was a little cartoon-villainy for my taste. Abuse is often far more subtle than this, but it can be just as harmful.
This is stuff you guys clearly want to know more about. So I wanted to write a post that went a bit further.
May this post give you a good, hard kick in the ass.
Do you have an emergency fund?
Don’t be ashamed if you don’t. Most of us don’t have one at all, let alone one that can sustain us over six months of unemployment or hardship.
However, this is fixable. Don’t put your head in the sand. You can start today.
Here’s the truth: Most of us are shitty at our finances.
Here in the United States, we often don’t learn enough about how to protect ourselves financially until it’s too late. It’s not just a lack of emergency funds. College students get in too deep with credit cards. Seventeen-year-olds choose a college based on prestige without knowing the reality of loan repayments.
I fully believe that personal finance should be taught in high school. I don’t see that happening anytime soon, however, so let’s do our best to catch up now.
The truth? As women, we are financially more vulnerable.
I know, there are plenty of men who read this site, but about two-thirds of my audience is female, which means that two out of three of you face an increased level of vulnerability.
We are more likely to earn less than men.*
We are more likely to have gaps in our employment.*
We are more likely to be victims of domestic violence.*
We are more likely to live in poverty.*
We tend to live longer than men,* and we are more likely to be widowed than men,* which both increase the importance of our retirement savings.
When you have this many financial factors stacked against you, you need to take more precautions.
Something Bad Could Happen
What do finance people always warn you about? You could lose your job. Your car could break down beyond repair. You could get seriously ill or injured. If you’re American, you could lose your health insurance or have an emergency where you won’t be covered.
Would you have the money to help you stay afloat if any of these things happened?
The examples in the piece on The Billfold involve physical abuse from a partner and sexual harassment from a boss. While these experiences are sadly far too common, they are not the only kinds of situations that warrant an escape.
Here are three examples of situations that may be more subtle than physical abuse, but absolutely justify using your Fuck-Off Fund to get away.
The Arrival of Mr. Hyde
You and your boyfriend date for a year or two, then decide to move in together. At first it’s great — you’ve always been a fun, compatible and loving couple. Moving in seemed like the perfect decision — it was the next step in your relationship, it saved you money or maybe got you a nicer place, and now you get to build a life together every day.
Sure, you bicker now and then, but things overall are really, really nice. Then your boyfriend hits a rough patch. He becomes stressed out, irritable, critical, and volatile.
He’s under a tremendous amount of stress at work, he tells you. His family is giving him problems. Money is tight right now and as soon as things level out and get back to normal, things will be different. But a lot of things you’re doing are making it worse, and you need to make some changes.
You’re not as neat as him, nor as organized, and you sometimes wear overly scuffed boots and sweaters on the verge of unraveling. He wants to be with a woman who always dresses smart, he tells you. If you worked on this, you would be a better person. And you agree with him, because you know you can do better.
Before you know it, you’re running around the apartment before he gets home from work, making sure it’s spotless and nothing’s out of place so he doesn’t start with the criticisms the moment he walks in. You’re dressing up exactly the way he wants you to, because it’s not worth the ensuing criticisms if you don’t. You’d rather just eliminate the issue before it happens.
But you can’t prevent everything. You fuck up. He discovers that you leave the blender in the sink after making smoothies. You thought you were being so good by washing the blender as soon as you finished your drink, but now he wants you to wash everything before you even take a sip. Maybe you were too quiet when his friends came over. He doesn’t want a girlfriend who isn’t the life of the party, he tells you.
Now it seems like despite your efforts, you’re now fucking up a few times a day. You forget to close all the windows when you go grocery shopping. You don’t hang up the bath mat after a shower. Each time, he gives you the silent treatment for hours.
At one point, you call him out. He tells you that if you’re forgetting every kindness he’s ever shown you, that you can get lost. And somehow, you end up apologizing to him.
Now you’re hiding in the bathroom and crying every night, wondering if you’ve been this much of a mess your whole life, or if it’s just starting now.
If it were physical abuse, you’d be out of there in a heartbeat — you’ve seen enough after-school specials to know that. But what is this in-between thing, these insults and freak-outs and constant criticism and silent treatment? Is this considered emotional abuse?*
This is not the man you fell in love with. What is this stress doing to him? You know that he is a good, kind man underneath it all! You wouldn’t be with him if he wasn’t!
But things aren’t getting better. You try to bring up the problems gently, framing them as communication issues, and he refuses to take responsibility, blaming work and money and his family and your inability to do anything right.
It’s a familiar routine at this point — you leave a pot in the sink to soak and forget about it after an hour. He lambasts you for 20 minutes. You let your face and mind go blank until he’s finished and sits down in front of the TV, unlikely to speak to you for the rest of the night. You head to the bathroom to cry in private, as usual, and then it hits you — this isn’t temporary. This is who he is and this is what your life with him will be.
You want to leave. But you live here now.
In order to leave, you’d need, at a minimum, first month’s rent, last month’s rent, and a security deposit for another apartment. Probably a broker fee on top of that. And you don’t have that. Plus the fact that you can say goodbye to last month’s rent and your security deposit on this place.
What can you do? Your best friend is married and her husband doesn’t like having people stay on the couch. Your other best friend has a new baby. You’ve got other friends, but nobody has a spare room in this expensive city and they’re not that good friends. Plus, everyone thinks your boyfriend is a great guy. They’ll never believe you.
Just a few more months, you promise yourself. Save your cash and you can afford to leave by Christmas.
The Company Shake-Up
You lucked out in the job department — you ended up with a kickass boss. He’s smart, he’s funny, he’s kind. He appreciates your contributions and implements your ideas. You’ve got a lot of potential, he tells you, and the two of you map out your career path at the company over the next few years. You’ll be ready for a promotion within a year if you keep up the good work.
Work is work, sure, and of course you’d much rather be on a tropical island than stuck in an office, but as far as jobs go, this is a good one. You’ve heard horror stories from your friends and you know how lucky you are compared to them.
Until your company’s board of directors decides to make some major changes. Positions are eliminated immediately. New hires will be arriving shortly. Long-term employees are let go with generous severance packages, and your boss is one of them. You actually smoke a cigarette with him to commiserate, then cough violently and resolve never to do it again. A week later, you’re introduced to your new boss.
Your new boss seems strict and a bit high-strung, but you’re sure she’ll mellow in time. The chemistry isn’t there, and after a month, it still isn’t there. Most people don’t have close relationships with their bosses, you tell yourself. This is normal. Even Good Guy Jim had trouble with Hot Boss Idris Elba on The Office.
But over the next few weeks, you learn that her stress levels are through the roof. She breathes down your neck, refuses your requests for time off, and micromanages you.
Immaculate work matters to her, she tells you. She’s behind you every day. She summons you for surprise meetings. You’re staying late and doing work ahead of time to be ready for her evaluations, and your heart starts pounding whenever someone silently walks up behind you.
And then it happens — you fuck up.
It’s not a huge mistake in retrospect — but it’s enough to delay an eagerly anticipated department-wide project. And if you still had your old boss, he wouldn’t have been happy but he would have still been in your corner, even defending you to the CEO if necessary. He knows what you’re capable of doing.
The new boss has seen none of your past work. Soon it comes time to have a meeting about your future at the company. Only it’s the complete opposite of the meeting you had with your first boss. You’re on probation.
If you thought things were tense before, that’s nothing compared to your days here now. You now report to an employer who makes you feel worthless. She’s started texting you anytime between 6:00 AM and midnight. Anything you prepare needs to be proofread by a 22-year-old coworker, which you know is pointless and nothing but a psychological move on her part. You’re on edge and shaking. You wake up in the middle of the night sweating and clenching your jaw.
Your friends see how miserable you are and tell you to just quit. You want to just quit. But how are you going to sustain yourself in the meantime? You can’t get unemployment if you quit. How are you going to pay your rent?
Furthermore, the prospect of ducking out for interviews worries you to death. You interviewed at Google once and it took five interviews before they rejected you. How long is this job-seeking process going to take? How many super-dressed-up “doctor’s appointments” are you going to have?
You go on one interview, clandestinely, take the offer. It pays 30% less. You can barely make your rent at this salary, but 30% less is better than 100% less. You haven’t accrued any vacation time and days off are out of the question.
Just a few months here, and then you’ll be able to interview for a job that pays you decently.
The Lost Income Stream
You’ve long dreamed of making your passion a full-time job, and you made it happen. Maybe you’re a photographer, or an SEO consultant, or you run a network of websites, or you have a jewelry shop on Etsy. After years of busting your ass, developing a portfolio, and amassing a client list, you’ve made it happen. You took the leap to do it full-time.
And you were responsible. You purposely didn’t quit until you knew you could sustain a frugal-but-comfortable full-time living from your side business. And for months or years, it worked terrifically. You knew you had to diversify a bit more, but your primary income source was rock solid.
But then something unexpected happens.
Maybe it’s that a competitor or multiple competitors are charging rock-bottom prices. Maybe it’s that another recession is hitting and people consider your products an unnecessary luxury. Maybe the latest Google update torpedoed your site on your highest sales-driving pages. Maybe outsourcing to India is cheaper and easier than hiring you. Or maybe your biggest freelance client, the one you considered rock-solid, went broke and can’t afford your services anymore.
You should have diversified earlier, you tell yourself. That could have kept you safe. But you honestly didn’t have the bandwidth to do that. If you had the money, you could hire a part-time employee and have her take over the time-consuming aspects so you could focus on the big picture.
But there’s no money for that now. There’s barely enough money for your rent.
You decide to look for full-time work again. And in the process, your family and friends who didn’t believe in you now have smug confirmation that you couldn’t make it as an entrepreneur. It doesn’t matter that most small businesses fail. This was your everything.
What Should You Do?
It’s easy to think that none of these scenarios would happen to you. But they can.
In fact, I’ve been in versions of all three of the scenarios described above. Not exactly as written, but very close. Me, a girl who seemingly has her shit together.
And I did not have a Fuck-Off Fund prepared during any of those situations. I’ve survived them thanks to a combination of luck, free housing and storage from generous friends and family, and some smart, well-timed business decisions.
Had I not lucked out, I would have been in a shitload of trouble. I’m not letting that happen to me ever again.
Now, what would happen if you DID have a Fuck-Off Fund in any of the above situations?
In the emotionally abusive boyfriend scenario, that money would have given you the freedom to find a new apartment before the abuse turned physical.
In the nightmare boss scenario, that money would have given you freedom to quit on the spot and job-hunt full-time for something better.
In the struggling entrepreneur scenario, that money would have bought you a few months to hire a part-time employee to handle the work while you develop new income streams.
Start an emergency fund. Today. Call it your Fuck-Off Fund.
I use Charles Schwab for my primary accounts, and they are a dream for travelers in particular (all ATM fees get refunded, even international ones, plus there are no foreign transaction fees). But I keep my long-term savings separate at Capital One 360, in part because you can organize several named accounts within one large account.
Fun fact: I had to rename my emergency fund “Eff Off Fund” because Capital One doesn’t like profanity. Or hyphens.
How much money should you have saved in a Fuck-Off Fund?
Enough to cover your expenses and live frugally for three to six months. Ideally six, and more is even better. (Suze Orman thinks you should have eight.) So that amount might be as little as $10,000. It might be $20,000 or more. Or it might be $3,000 if you live in Chiang Mai.
I know this sounds daunting. That is a fuckload of money to save up. Don’t think of this as a long-term struggle, though — this is a lifestyle change.
The best way to do this is to audit your spending and come up with a number that you can contribute to an emergency fund each month. Have that amount be automatically transferred when your paycheck comes in. (For us entrepreneurs with irregular earnings, I know this is easier said than done, but you should have a ballpark monthly salary at least.)
You can have $5,000 in your Fuck-Off Fund by the end of the year, plus a little extra, if you save $425 each month. FIVE THOUSAND FUCKING DOLLARS. Save what you can. $500 stashed away is better than $100 and $5,000 is better than $1,000.
What if you have debt? Many Americans do.
Start by saving a smaller amount — think $1,000. Having $1,000 in emergency savings is a good minimum cushion.
From that point, continue paying off your high-interest debt until it’s gone. Once it’s gone, go back to restoring your Fuck-Off Fund on a monthly automatic basis. You will get there.
What else should you do? Too much to include in this post.
I do highly recommend the book I Will Teach You To Be Rich. It gave me the financial education I should have had all along.
Situations when you need a Fuck-Off Fund are more common than you think.
What I want to emphasize the most is that you might be in an emergency situation even if you don’t think that you are. Particularly when it comes to verbal and emotional abuse.
Pop culture tends to send the message that the turning point is once it escalates to physical violations — hitting, slapping, groping. This does us no favors. Having been through this myself, I can tell you that emotional and verbal abuse can be just as destructive to your mental health. Abuse is often more subtle than you expect. More Edward in Twilight than the dentist in Little Shop of Horrors.
When the time comes when you need to escape, you’ll be able to do so far more easily if you have the financial resources.
Join me in making a savings goal for 2016.
If you haven’t done so yet, it’s time to get started. Do you think you can save $1,000 in your Fuck-Off Fund by the end of 2016? $3,000? $5,000? Maybe even $10,000? That’s $83, $250, $417, or $833 per month.
I know it’s hard. We all have a lot of expenses, we’re in debt, and we struggle. For those of us who are struggling to feed ourselves and our families, saving for an emergency fund is not an option right now. I get that. Food, shelter, and safety need to be your priorities.
But I also believe that many of us have more money to save than we think. Even if it’s just $50 each month, that’s incredibly valuable and will get you closer to a base of $1,000. That money will be there for you when the shit hits the fan.
We all know that the shit hits the fan eventually. That’s life. But we can minimize its impact by being as prepared as possible. When you save money toward a Fuck-Off Fund, you’re buying yourself options.
Was there ever a time in your life when you could have used a Fuck-Off Fund?