“Ma’am, your card was declined.”
He’s not speaking to ME, is he? No, he can’t be because I know I have money in my account.
I look up, and the clerk’s brown eyes were looking at me sympathetically, like I was a puppy whose owner didn’t give her a treat for rolling over. Like he had seen this way too many times.
“I can run it again,” he suggested.
I don’t think anyone could’ve stopped the fire of embarrassment that burned through me. For three seconds, the hotel floor collapsed below me and I fell, and there was no bottom and no end to the horror.
“Or do you have another card?”
I looked in my wallet, even though I knew that I didn’t carry credit cards. It was one of the rules Alex and I had agreed to when we decided to tackle our finances. We weren’t using credit cards anymore. In this moment, however, I really wished I had a credit card on me.
Deep, ugly shame washed over me as the next words came out. “We had some bills to pay, so maybe that’s why there’s not enough funds in there. Let me make a transfer.”
I felt like I did in fifth grade when I couldn't do a current event assignment because my parents couldn't afford to get the paper regularly. Like that one time the same teacher pointed out my T-shirt from Wal-Mart and everyone in class laughed. Or when my parents could only bring the ninety-nine cent crackers for snack time when other parents brought fancy banana-nut bread.
Basically, all my insecurities about being poor came out.
Head down, I left the front desk and sought shelter at the side of the lobby, away from the looks of pity I was receiving from some of the other clerks. Like a wild animal retreating to lick her wounds.
I avoided eye contact with the other hotel guests and pulled out my cell phone. I tried to connect to my bank account, and each time, the wifi kicked me off.
What the heck? I thought. Why am I being punished this way?
After several failed tries to connect to my bank account, I called Alex.
“Can you transfer some money into my account?” I asked through a fog of shame after explaining what had happened.
“I don’t have any money,” he said.
I might as well get in my car and drive home, I thought. Who cared about this stupid conference anyway? (Did I mention I was at a professional conference? Yikes.)
“But I can transfer some money from the emergency fund.”
The emergency fund. The beautiful emergency fund.
I had forgotten about the hard work we put into creating a fund for these exact moments. I sunk into the arms of relief and thanked the ancestors, the heavens, anyone who was listening.
Minutes later, as I walked to the elevator that would take me to my room, I had only one goal: forget this ever happened. If anyone asked, I was going to deny, deny, deny. What I didn’t realize at that moment was that our emergency plan had worked. I had escaped a credit card relapse. I was free.
My miseducation about money
When it comes to money, I think most people look at it one way: the more the better. Make a lot of money and you can buy a lot of things. Make a lot of money and you can have a big house. Make a lot of money and you can go on a fancy trip to whatever island you want. You might even be able to buy an island.
Because of this way of looking at money, most of us never learned any other way of dealing with it.
When Alex and I finally decided to learn how to manage our finances, to stop reacting to money and start directing it, I realized how misguided my financial education had been. In fact, I realized I barely had any financial education. In elementary school, we learned how to count money--how to tell the difference between dimes and nickels. In middle school, we barely touched upon money. In high school, we learned about economics, terms and ideas so out of reach for most of us that they’re practically impractical.
In the end, we came to know what money was and how to spend it, but we never quite learned how to manage it or why we needed to manage it.
Why you need an emergency fund
Lemme tell you what used to happen to me when we didn’t have an emergency fund. Every time there was an emergency--whether real or not--I’d put it on a credit card. I'll pay it next month, I’d tell myself. A few times doing that and the amount added up to a total that I couldn’t afford to pay off. And that’s how the credit card companies got me. Before I knew it, I was thousands of dollars in debt, and it was only getting worse.
An emergency isn’t a pair of heels or a new jacket. An emergency is an unexpected circumstance that requires immediate attention or you won’t be able to live your life. It’s a need that has to be remedied, not a want that’ll give you momentary satisfaction. Emergencies happen all the time and credit card companies are banking on the knowledge that most people don’t have an emergency fund. The motherboard on your laptop fries? Your car needs a new radiator? A loved one’s in the hospital and you suddenly have to fly home? If you don’t have an emergency fund--like most people--and you don’t have any money in your checking account because you’re living month to month--like many people--you’d have to put the costs on a credit card.
If you did have an emergency fund, however, you’d buy a new laptop with your emergency fund. You’d get a new radiator for your car and purchase a ticket to be with your loved one without having to risk going into debt. You’d be ahead of the credit card companies. You'd be able to preserve your freedom.
How to start an emergency fund
In his book The Total Money Makeover: A Proven Plan for Financial Fitness, Dave Ramsey goes over seven steps to help you take control of your money. One of these steps is starting an emergency fund.
If you haven’t read The Total Money Makeover, I really encourage you to get ahold of it. You don’t have to buy it. You can check it out from your local library (although I hear it’s a pretty popular checkout). The emergency fund is the first of Dave’s 7 Baby Steps toward financial freedom. Each subsequent step strategically sets you up to get rid of debt and build financial security. But let me warn you, you’re gonna want to read the whole thing in one sitting.
Dave suggests that you save $1000 as fast as possible. With this savings in hand, you’ll be less likely to turn to your credit cards when an emergency happens. He goes over several different ways to get a $1000 fast, including having a yard sale. Instead of a yard sale, Alex and I decided to save $200 a month for five months. My emergency at the hotel happened when we were close to the $500 mark. He transferred $400 to my account so I could pay for my hotel room. Then we replenished the emergency fund once we got paid.
Even though the emergency fund is the first of the 7 Baby Steps toward financial freedom, we took one other step before we started it. We made a budget (basically, I made a budget and coerced Alex into following it with me). We sat down and listed all our expenses for each month and then assigned every single incoming dollar to those expenses until we were zeroed out or almost zeroed out. One of the items in our budget was the emergency fund.
I just want to forget that moment in the hotel forever.
It was embarrassing and it made me feel like an imposter. Like I was playing adult and the real adults finally caught me. But it also put things in perspective. Up until then Alex and I had been putting money into our emergency fund, but we hadn’t yet had an emergency. Having this emergency showed us both the importance of the fund and what it could do for us. And that is why I’m sharing this with you. It doesn't matter if you're 18 years old or 30 years old, if you don't have an emergency fund, start one now.
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