In February, inspired by another blog I read, I decided to start saving all my $1 for an emergency fund. The blog I was influenced by saves all of her $5 bills, but I don’t feel like we are in a financial position to take so much out of our daily budgets right now, but maybe someday.

As we primarily use cash, a fair amount of $1 bills go through our hands. We take them and put them in a separate envelope marked “emergency”. Each time we get to $100 in singles, I bring it to the bank and change it out for various larger bills. Currently we have $300 in the envelope, all in 20s. We are past half way to another hundred dollar mark and we will probably turn that into a hundred dollar bill when the time comes, and maybe after that we will change the singles in to fifties. We like the idea of having the money in different denominations so if we ever do have to use it, the money is actually useable and convenient.

Although it is not a huge emergency fund, it is a little extra money that might come in handy one day. And as it continues to grow, it will be more and more substantial. We don’t currently have a goal for our $1 bill emergency fund, other than to watch it grow, but have talked about different things we can use it for: appliances suddenly breaking, unexpected car repairs (that we can’t fund with our car envelope), unexpected medical bills, or maybe (once the numbers line up) we will use whatever is in the envelope to pay off the last of our debt. (That would be a dream come true!)  At this point it is all speculation, but it gives me a little peace of mind to know we have a small stash of money that isn’t already designated to somewhere.

We do have a small emergency fund in the bank, but we are nowhere near a fully funded emergency fund. Like I said in my last post, however, we are working hard at maxing out our sinking funds, so emergencies will be fewer and farther between, but a little extra insurance never hurt anybody!