Financial Horror Stories: Lack of Emergency Savings Leads to Financial Nightmare

We’ve asked several people to share their financial horror stories with us with the idea that we can learn from their mistakes. To start this series, it’s only fair that I share my own story of a not so great financial time in my life.

What’s the biggest money mistake you’ve ever made and how did it impact your life?

When I was growing up, I always worked. There were times in college when I had three part-time jobs. I never imagined a day when I would be jobless, but there I was - laid off from a job with zero emergency savings, divorced, three kids, student loans, and credit card debt. It was indeed a recipe for disaster.

I did get unemployment, but that didn't start right away and didn't last all that long.  While I didn't have any emergency savings, I had been saving for retirement over the years so it could've been worse. Still, I blew through my retirement savings faster than I ever would've imagined.  If I'd had some emergency savings, we could've lived off of that during the transition. I got behind on my bills and it was super stressful playing catch up. I also had to start saving for retirement all over again.

If you could go back in time, what would you do differently?

When I was growing up, my mom was really good about teaching me to save every time I got money. She always told me the first 10% of income goes straight into savings. I wish I heeded her advice, especially once I had kids.

Did anything good come out of the mistake?

I genuinely understand financial hardship and can relate to my clients about it. I've been there. I've lost nearly everything and had to rebuild. I teach on the importance of emergency savings, and my teaching comes from learning the hard way.

What is your biggest financial fear?

My biggest financial fear is not being able to give my kids everything they need. Since becoming a mom, financial security has become incredibly important to me.

What’s one piece of financial advice you would like to share with our readers?

I want to share two pieces of financial advice:

First and foremost, if you don't have emergency savings, start an account today. It doesn't matter how much you earn or how much your bills are, start somewhere. It will make difficult financial times in your life so much easier.

Secondly, if you need help, reach out and ask for it. I started the Moms Managing Money Facebook Group because I know that not everyone has someone who they can ask their financial questions to. We're here for you!

Other posts in our series of financial horror stories:

Financial Horror Stories: Credit Card Debt

Financial Horror Stories: Reckless Spending

Financial Horror Stories: Vacation Timeshare Regret

Financial Horror Stories: Investment Gone Wrong

Financial Horror Stories: Excessive Debt

Financial Horror Stories: Overspending to Please Others