Perhaps some of them earn less because they do less work do less work and/or work less hours and/or work a less stressful position. HR and Marketing are usually out the door by 5 at places that I’ve worked. The Engineering and Computer Science folks typically work long (12 hour), stressful days.

To say that you and your spouse are a certain way can be a useful example. To assume that *my* spouse and I must be the same way (at least if there isn’t something odd about us) is, to say the least, presumptuous.

What Marta said. Some wives are more concerned about financial security than their spouses, some are less. Whether or not it’s more likely to be one way or the other (and for whatever reason) is simply a distraction in this case.

So why not, well, simplify, and cast the issue in a way that’s useful both for couples who fit Ramsey’s model for couples that don’t? There are certainly plenty in both categories, from my own personal experience.

I mean, I could do that with a statement of yours where in this very post you say

“Guys are better at focusing in, at breaking down barriers.”

See, taken out of the context in which it was written I am sure many people could read a lot into that statement. If I posted that statement on another website and wrote that “Trent at Thesimpledollar.com says…” How many people would respond that you are sexist, narrow minded, etc.?

There are evolutionary reasons why men and women have different skeletomuscular systems. I don’t think it is particularly radical to admit that their brains aren’t exactly the same, either, (as has been shown by numerous studies) and that this results in differences that can’t be explained by cultural or societal conditioning.

Different brains don’t make men or women better or worse than each other any more than different bodies do. It just makes them different. I don’t understand why that seems so scary to some people.

Wanna hear my non-fundamentalist opinion on the emergency fund issue? 1) If you can’t see eye to eye with the one you love on finances, do NOT get married. Live in sin. Keep your house and vehicle in your own name, and set up trust funds for any offspring. 2) If you’re already married and not in debt over $1000, stay married and squirrel away cash on your own. It costs too much to get a divorce and break up a household. 3) If you’re gay, do not buy books by Dave Ramsey. He isn’t ready to acknowledge, let alone address, the financial needs of non-heterosexual households. He thinks you’re an abomination, but I think he is. And I know I’m right because the Goddess told me so.

I think I fall into the 6-month savings category because I am single. THAT is a scary prospect – but I think it’s the reality check we all need. My goal is to pay down any debt I have first, then move on to the ER fund.

Jim from Bargaineering did a guest post on the Quicken Blog for us a while back on ER savings funds too. Breaks down a few simple tips for getting started. Thought folks might like to take a look if they just need a starting point for scraping up those extra funds each pay period or month: http://blog.quicken.intuit.com/2009/05/12/do-you-have-an-emergency-fund/

Chelsea, Quicken

Note: if you’ve laddered your CDs and still need to cash one out, all else being equal choose the one with the lowest interest rate or the one where the penalty would be lowest, probably the one you just bought. If you cash out the one that’s going to come available next month, and then need more money next month, you’ll have to cash an additional one early.

Nowadays, my online savings account pays almost the same as the CDs at my credit union (and at my online savings bank), so I don’t bother with the CDs.

For a while, I kept $500 in my local bank and only enough other money until I had $700 and then would buy stocks. So if I had an ill-timed emergency costing more than $500, I might have to cash out stocks, perhaps right after they plummeted. I liked that idea, too. But then I have no dependents, a government job with very little chance of layoff plus a fixed interest mortgage plus I don’t need a car to get to work or to a grocery store, etc.

(Now I have a bunch of renovation stuff I might be about to do soon, so I have loads of cash again. By “cash” I mean it’s in my online savings account except for one last CD with a good rate and $500 in my local credit union savings account which can be transferred to my checking account instantly if the internet is up.)

As far as how big to make your emergency fund, although I’m obviously the poster child for the three-month version, that’s not how I do things. I actually split mine up into a new-car fund, car-repair fund, health-repair fund, and house-repair fund. I put a certain amount of money each month into these and don’t stop doing so just because it reaches some threshold.

I suppose I have an unemployment fund, too. I have some vacation time saved up that would be cashed out if I were laid off or quit (a little over two months of full pay, so more like three months of expenses). And I could take back contributions to my Roth IRA.

I’m realizing Ramsey might not consider any of these to be real emergencies (obviously my car will break down occasionally and I will get sick sometimes) except maybe the unemployment. But if I had some other sort of emergency, I would raid from these funds and also my vacation fund (funerals don’t make the best vacations, but hey).

Finally, yes the sexism was offensive. But just because someone’s an idiot in one area doesn’t mean they have nothing useful to say. Aren’t we all idiots in some area? Too bad have this thread has been hijacked by this unrelated topic.

I like one response I saw to this from Dave Ramsey. Don’t think of the EF as an investment to make you money. Think of it as insurance to protect your actual investments from losing money by being forced to tap into them.

That said I also agree with Trent in that I’d prefer to have rolling CDs so at least you’re earning something above the typical bank account.

I didn’t intend to come off sounding critical of Trent. He is human, after all.

Trent has proven himself to be a very astute and sensitive person who looks at things with a set of broad and critical perspectives, and who challenges traditional dogma from all sides.

My point in commenting that Trent should have written something about Ramsey’s sexist generalizations was simply my observation that Trent is usually skeptical of generalizations and my hope/wish that he would have extended that skepticism to the sexist tripe that Ramsey was presenting as fact, even if it didn’t initially strike him as sexist.

I really hoped that Trent would have identified the sexist nonsense as such, but based on his track record of learning and growing from our comments, I’m sure he’s got his radar tuned into it now.

My wife’s desire for security is much smaller than my own even though I am the bread winner and she is the stay at home mom.

First, Dave Ramsey was flip and sexist when he called the behavior of some women to emphasize security as a “security gland.”

I’m sure the behavior variance he is describing is due to a combination of culture, learned behavior, nature, and the real-life experiences of women who earn, on average, 78% of what men earn (in the US), and who often take time out of the paid workforce to raise children, which decreases both their current earnings and future retirement benefits.

We all know that Ramsey’s take on life is from a more conservative and Christian perspective, so we shouldn’t be surprised that Ramsey is not exactly egalitarian and non-sexist. But that’s no excuse for Trent to post Ramsey’s remarks without some thoughtful insight and perspective on the sexist nature of the remarks. I know women who are not “wired for security” and men who are extremely cautious.

Generalizations and stereotypes detract from the message, which is that *every one of us* needs a substantial emergency fund maintained in liquid assets.

Now for my second point. Trent is confusing money market mutual funds (which are NOT insured by the FDIC) with money market savings accounts (which ARE insured by the FDIC). The bank money market account is a form of savings account, with the ability to write checks (up to six per month).

I have most of my emergency fund in a bank money market account, some in a credit union share account, and a smaller portion in laddered bank CDs (certificates of deposit). It all adds up to about one year of living expenses. I used to keep six to eight months of living expenses in my EF, but with my current job insecurity I’ve added to it in the past year.

Suze Orman is absolutely correct on the eight month minimum for an emergency fund. In this current economic climate, if more than one emergency hits you (job loss PLUS medical emergency, for example), you can’t count on being able to get a job, a well-paying job, or a job which includes health insurance in short order.

Statistically (you can google it) …
- women earn less (it still hasn’t topped 80 cents for every dollar a man makes)
- women more often take the time off to have and to raise children (less income, less credits for social security)
- when men and women get divorced (even with no children) the man’s living standard goes up while the woman’s goes down
- women live longer (so savings have to last longer).

Men and women ARE ‘wired’ differently and they ARE nurtured differently.

For me, Dave’s saving grace here was the word “typical”. This meant it was a generalization, applicable to his experience, to his audience, to his cultural environment. Anyway, I enjoyed this particular chapter of TTM. I agree that 6 months living expenses is about right. After that, I believe a person should start saving for dreams because having money in the bank earmarked for a specific purpose makes it more real, more attainable.

Money market accounts *are* FDIC insured. Money market funds are not.

However, if you really need to pull money out of a CD but don’t want to get hit with massive penalties, look around. For example, at my credit union I get CD rates close to those of Ally. You can pull out the interest money without penalty. If that isn’t enough money, the terms of the CD allow early withdrawal of the CD but the only penalty is up to 1/2 of the interest earned on the CD, the principal will NEVER be touched.

I have looked around and there are several credit unions with similar terms. Check those out. Unlike Ramsey I don’t think the emergency fund should be too liquid like a savings account (too easy to spend). It seems better to have it less liquid BUT available. And CDs are the best for that if you can find good ones with reasonable terms.