Emergency Funds Can Have a Surprising Downside
If you're only saving for emergencies, you’re missing out. Go beyond that with an opportunity fund. My family tapped our opportunity fund twice last year, and it changed our lives.


Why save for opportunities when everyone tells you to only save for emergencies instead?
Because you’ll be operating from a place of abundance, not scarcity, and that can make a world of difference.
It’s valuable for each family to have a cash emergency fund that can be tapped for true emergencies — like a car breaking down or furnace repair in winter — but this needn’t be more than a few thousand dollars. Typically, an emergency fund is a pot of money equal to three to 12 months of living expenses.

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Once you’ve comfortably saved for an unforeseen, short-term emergency, then you can turn your attention to higher aspirations.
Let’s Get Real
It was devastating to our family when my husband lost his job in summer 2016. Bryan is a highly educated, hardworking and ethical man. He attended college on a full-ride scholarship and graduated in four years with undergrad and graduate accounting degrees.
Bryan went on to work for a Big 4 international public accounting firm and then transitioned to a corporate role at a large, highly regarded company. He worked full-time and took evening Master’s in Business Administration (MBA) classes at a prestigious local university. Bryan transitioned into a new position and graduated from the MBA program within 2½ years.
When the company was downsizing in 2016, my husband received his pink slip. It was a shock to both of us! He was fortunate to have a small severance package, but that only covered a few months of unemployment. Luckily, he found a new position before his severance ended.
In 2016, we were grateful that we didn’t have to draw on our emergency fund. I use the term “emergency fund” because both Bryan and I were then operating under a scarcity mindset.
Using an Opportunity Fund for Overseas Travel
The story doesn’t end here. Our opportunity fund enabled our family to take a big risk and pursue my dream of living abroad in early 2018. (Read Budget Travel Tips Straight from a Financial Planner’s Own Family Trip Abroad for the nitty-gritty financial details.)
Bryan worked long hours, came home exhausted and rarely exercised in 2017. When I asked about his day, he rarely had anything to say. The stress of this job was wearing him down, and our family life was suffering. We were financially strong, yet crumbling on the inside. Something had to change.
Bryan and I decided in late 2017 to take our three boys to Spain for three months. We traveled to Barcelona, Valencia, Madrid and Seville, witnessing the beauty and magnificence of these historic cities.
As an entrepreneur who leverages technology to serve clients locally and remotely, I was able to work from my laptop while overseas. Bryan’s position, on the other hand, couldn’t be handled remotely. Bryan left his role in December 2017, promising me that he would use time in Spain to re-evaluate his career. He also agreed to be the primary caretaker for our sons and home-school them while living in Spain.
We heavily relied on our opportunity fund while living overseas and again when we returned to the U.S. in April 2018. Bryan’s search for employment continued over the summer, and child care and camp expenses were hard to fund on my income alone.
Our opportunity fund was valuable for two BIG reasons:
- It enabled us to live in Spain, and
- It provided financial security during Bryan’s subsequent job search, giving him time to find not just a job, but a fulfilling new career.
Are You Engaged in Your Work?
Career fit and engagement are interconnected. Gallup’s State of the American Workplace report released in February 2017 finds that only 33% of U.S. employees are engaged in their jobs. That means 67% are disengaged. Are you in that 67%?
Being professionally engaged means you have purpose to your work life. Setting and achieving big goals is realistic. Because you are in a state of “flow,” it doesn’t feel like you are “working” most of the time.
If you are lazy or apathetic at work, you probably fall into that 67% group and should strongly contemplate alternate career paths while building an opportunity fund. Also consider talking to managers who may be able to assign tasks that play to your strengths. Leaving the organization altogether is not the only solution — you may be able to switch roles within the company.
When your personality traits, values and job responsibilities are in alignment, you are more likely to be engaged at work. Work satisfaction spills into other areas of your life as well. You become a better parent, spouse, sibling, son or daughter, friend and neighbor.
In other words, career choice matters. To better understand if you’re in the right profession, take this quick, free assessment.
Just because you start down one path does not mean you cannot change it a few years later. Consider reading Jeff Goins’ The Art of Work if you know you are stuck and want to uncover your calling.
How to Make an Opportunity Fund (and Change) Possible
The concept of job satisfaction is closely tied to an abundance mindset. As Henry Ford once said, “Whether you think you can, or you think you can’t — you’re right.”
Staying stuck in a scarcity mindset not only lowers your ability to find a fulfilling career but also mentally prevents you from building an opportunity fund. Your brain may still tell you to build an emergency fund, but once you’ve done that, it’s time to take it to the next level and think beyond emergencies to how you can expand your horizons.
How much should you save in your opportunity fund? Only you (and your professional adviser, if you have one) will be able to provide direction on the amount. It’s specific to YOUR goals and dreams, not some arbitrary number. Our family took some of the cash we had already saved in an emergency fund and repositioned it to an opportunity fund. Our income in 2017 was stable enough to keep three months of living expenses in the emergency fund and move the rest to the opportunity fund. Any new savings — outside of retirement or college savings — went into the opportunity fund. Having returned from overseas travel, our emergency fund is intact and we’re working to rebuild the opportunity fund.
Prioritizing an opportunity fund over retirement savings is a slippery slope. It’s better to strike a balance. If you can save 15% of income and already have an emergency fund established, perhaps contribute 8% to retirement and 7% to the opportunity fund. Don’t let short-term intentions deter you from reaching long-term goals.
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

Deborah L. Meyer, CFP®, CPA/PFS, CEPA and AFCPE® Member, is the award-winning author of Redefining Family Wealth: A Parent’s Guide to Purposeful Living. Deb is the CEO of WorthyNest®, a fee-only, fiduciary wealth management firm that helps Christian parents and Christian entrepreneurs across the U.S. integrate faith and family into financial decision-making. She also provides accounting, exit planning and tax strategies to family-owned businesses through SV CPA Services.
-
Last Call for Fortnite Refunds: Parents Can Still File a Claim
The FTC is sending out $126 million in refunds to families whose kids were charged for unwanted items in Fortnite — and there’s still time to file a claim.
-
Stock Market Today: Stocks Swing as Trump Scraps Canada Trade Talks
Despite a mid-afternoon slip, the S&P 500 and Nasdaq ended the day at new record highs.
-
These Are the Key Tariff Issues to Watch in Coming Months
While they're not dominating headlines right now, tariffs are not over. Some key dates are coming up fast that could upend markets all over again.
-
Bill Bought a Fridge, and Then His Nightmare Began
A Lowe's customer reached out to me after he encountered the retailer's 48-hour return window for major appliances when his brand-new fridge turned out to be defective.
-
Savvy Marketing Tips for Financial Pros From a Financial Pro
These strategies for marketing, client acquisition and retention can help financial professionals elevate their business and production.
-
Divorce and Your Home: An Expert's Guide to Avoiding a Tax Bomb
Your home is probably your biggest asset, so if you're getting a divorce, the stakes are high. Keep it? Sell it? You need to have a good plan in place for how to handle it.
-
This Is How a Lot of Law School Students Are Cheating
Growing numbers of students are falsely claiming a learning disability to score more time to take tests. This has real-world consequences in which fellow students, law firms and their clients pay the price.
-
Is Your Home Disaster-Ready? An Insurance Expert's Guide to Preparing for Storms and Fires
Homeowners can take these steps to protect their properties from hurricanes, tornadoes, wildfires and hail, while also potentially reducing their insurance costs.
-
A Financial Adviser's Defense of Annuities: They're Just Misunderstood
Annuities can offer retirement income stability and security against market volatility, though some do have drawbacks. The key is to understand their features before buying.
-
How My Dad Taught Me the Compounding Returns of Fatherhood
As Father's Day approaches, I remember how my father's small acts of love and generosity added up over time and influenced my relationships with my own children, proving that the best investments can grow across generations.