Had a really nice day yesterday after work about 65 outside and not to muddy, brought a load of wood up to the house, organized my stacks, split 1/2 a cord and took inventory for the remainder of the year. I'm needed an early spring and will have to run the heat pump during the day as some wood I was counting on seasoning enough to be usable after 10-12 months is nowhere close to being ready. But it got me to thinking how many people are counting on something and when it fails or does not come through are in serious trouble. It's great to have 3 year supply of wood but do you also have 3 months cash, 3 weeks food and 3 days water? What good is 5 years wood supply if you lose your job and can't pay the mortgage! I know the economy is improving compared to 08-09 but recessions happen every 10-20 years. I lost my job in 2010 I've read many people here have either lost a job, management change making work terrible or health preventing from working. So who's going to sell some wood/work some overtime to make some extra cash and fill out those stacks be it cash, food, or water. PS we just had an ice storm (not bad) so I'm doing preaty good on food, I should store a little more water and can always use more cash.
If you heat your house with wood, then your stacks are like money in the bank. One less utility bill you need to pay, when times get a bit tough. Just my opinion.
I was kind of expecting something about baby pigs, based on the thread title (a way to remember a sow's gestation length is "3 months, 3 weeks, 3 days"). I used to do some disaster preparedness, but hadn't heard this saying. Always good to be prepared!
Where I live, I'm more likely to keep three days worth of gasoline rather than water. I can run a generator and get water out of my drilled well. Three weeks food no problem. Three months cash - that's kind of funny. Sad but true, who the heck keeps three months worth of salary around in cash?
Well stated DNH. I would just state that 3 or 4 months, especially with cash on hand, is not enough. It definitely can be tough if one loses his job because of whatever and I remember having that happen a couple times. Fortunately severance pay helped but had we no money stashed away, it would have been much tougher. In addition, way back in 1984 I had a terrible injury and although I tried going back to work twice I just could not do anything. On top of that, workman's compensation came through very slowly and later SS came even slower. Thing got a bit tight for sure, but we made it and are still making it, albeit a bit thinner than most. But we are happy and one of the things that make us happy is we had no mortage when that injury happened. Had we had one, we're not sure what would have happened. Moral: stash some away; be prepared.
That's what got me started with the sequence! Jon_E I agree about the gas on hand as I have a well and generator but what happens if the water is contaminated/generator goes out/pump burns out/I'm out of town and wife can't start the generator. That stored water buys me time to work on what I need to rather than being in a bind. You don't have to have 3 months salary, start with $500 emergency cash on hand then add to it. If/when something happens do you have enough cash/bonds/stocks/etc to prevent yourself from getting evicted/foreclosed on. And can you pay that unexpected bill without using high interest credit cards. Backwoods Savage great testimony and reminder that anything can happen to anyone at anytime. The old recommendations was 3 months but from what I've read the new recommendation is 6-12 months expenses due to higher debt load and slower rehire rate frequently with lower salary than before. The best way to lower the cash on hand requirement is to lower your debt!
Still feeling the carnage from 08-09 myself. Changed some spending habits and thankfully, I was prepared for it in the amount I had financed (mortgage and vehicle) at the time. I will be free by the time I fully retire.
Too many people don't have 3 months of cash reserves. I'd go out and say that most people don't. Now, wood in the stacks, as MikeInMa stated is basically money in the bank if you heat with wood. For me, installing my Quadrafire insert allowed me to save at minimum $3 a day on natural gas bills in the heating season. The stove paid itself off last season, actually I was ahead after last season due to the deal l got and by installing it myself.
The seasonal nature of my business makes it essential for me to have 3-4 months worth of bill paying ability. I know my workload will diminish right after Thanksgiving. By Christmas time, if the weather cooperates, I'm usually down to a weeks worth of work. So yeah, I always have a few months cash in reserve. I can fire up the genny to run the well pump. I have 30 gallon of ethanol-free gas that will last quite awhile if I'm careful with it. I also keep 2 55 gallon barrels of water in the basement. They get drained every year in the fall and refilled. And if all else fails, I have a small supply of high quality filters that I can run the pond water through. Food? One basement wall is lined with shelving and filled with mostly home canned food; meat, veggies and fruit. There's also a couple shelves with dehydrated fruit and veggies. 50 laying hens mean eggs are plentiful. I dried and powdered about 12 dozen recently. The left side of the above picture is excess roosters from one of the hatchings a couple years ago. On the right is some sausage and venison. With that and 2 freezers of meat and veggies, there's well over a years supply of food if things should really go south. After the '08-'09 debacle, I went into high gear getting ready for whatever nature or man throws at me. But I wasn't content with just buying a lot of extra stuff. I wanted to learn how to do it myself. I did, and I feel much better about weathering the unforeseen.
08-09 stopped me from retiring when I had expected to. It turned my 401k into a 201k. The good part for me was that I recognized it was exactly the wrong time to get out of the market so I doubled down over the next couple of years and the account balance bounced right back up. If I had seen it coming I might have taken a part of my account to cash just so I could buy back in on the bottom but I was surprised just like so many other people were. I am just nervous enough about the market now that I have about 15% of my IRA in cash waiting for the next shoe to drop. Any time the market is increasing quicker than you could hope for, it is time to take some of that money off the table. Too good to be true is exactly that. It is not true and will turn around and bite you. Meanwhile the rest of the account is getting a nice boost in value since the elections for now. When it turns on me, this time I will be ready to invest that 15% in stages during the drop. For a while there it seemed like every time I was a few months ahead something would come up that made me start over saving. Even with that said it sure was nice to have those savings to fall back on. Now I have about a year outside of my IRAs that I could tap into if it was needed and I like having that cushion. Who knows what will come up next?
Wow guys! I put away 20 cans of soups that have now expired and I'm eating them...lots of crackers....don't discount friends....
Just a thought. Check your ins policy, as I understand most won't cover more than 500+/- cash without a specific rider or whatever it's called. For some 3+ months expenses in cash could be a sizable number over the possible coverage amount. I certainly hope nobody has to find out but we do heat with wood and sometimes bad things can and do happen. Do your best to be covered while being covered. Pigs is the first thing I thought about on this also. Owl
For $200 you can have a private insurance policy. Most good safes will withstand 1700° for 1 hour. Mime is a combination lock. I don't trust the electronics with that much heat. Bolt it to the concrete floor and it's virtually burglar proof as well. I found a couple cans of soup that had disappeared in the back of one of the cabinets at camp. Yep, I had to try it. I'm still here.
Some great ideas here. Glad you brought this up. We like to try to hoard more than just wood. Paid the house off early about 4 years ago. Out of car payments too. Those are great feelings for sure, but there is always more we can do! Especially in the cash savings area. Sadly, most Americans live paycheck to paycheck... A lot of people are only two weeks away from bankruptcy.
Precious metals like gold, silver and lead are important also. And a skilled labor can be good for bartering if things get really bad!
I'm working on a lot of this myself; enlarging the garden each year trying to can more each year. Family emergency prevented me from canning as much as I should have last year. Hope this year is better Great advise and planning I'm not there yet but I'm working on it. I'm 2-3 years out from retiring some debts that will put me in a much better position.
The hardest part is getting started! Once we start we just need to stay on track to reach our goals. So many guys i work with dont contribute to our 401k. And dont seem to care that they are missing out on the free money that our company matches.
1 more check and my 401k loan is paid off, all that's left is the house and car, once my 401k loan is paid I'll be starting an emergency savings since we haven't had one in 4 years (used up everything we had to get %20 down) then we remodeled and ran into more and more problems, finally have a bunch of cash from our wedding were keeping to remodel a bedroom that I stick extra cash in when I get side work Welding. I worked like a dog last year, 200 hours of overtime the first 3 months to pay off a truck loan credit cards and the little bit that fluctuated in my personal line of credit. It's been a crazy year but is turning around, knock on wood. So on wood were 1.5-2.5 years ahead depending on propane prices and temps, probably 2 safe months with cash and no reserve on food other than what's on the cabinets as freezer, water, we have a trout steam right next to us.