Quote:
Originally Posted by kn
How much savings is suggested? I've read everything from 3-18 months of expenses. I guess it also depends on how stable one's career might be I suppose but I'm sure a lot of O&G folks felt comfortable in their jobs.
Once I manage to save a decent amount I'm never able to let that amount of cash sit and always deplete it with TFSA/RRSP and other investments. I hate the thought of missing a year of contributions just to build up an emergency fund producing little returns.
I guess I'd dip into my TFSA first if faced with an emergency.
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Using the TFSA for emergency funds or a rainy day fund is not the worst thing you could do. It will depend on your exact scenario at the time of needing the money, but generally speaking you would pull from the TFSA prior to the RRSP because of the tax implications and also because the TFSA room comes back in the following year whereas the RRSP room does not.
The question on how much is a bit of a range. Generally 3-6 months is what is commonly recommended. It does depend on what the nature of your employment is to some extent, but consider other factors. If you have a position that is highly leveraged to the price of oil and then put your emergency funds all into oil stocks that is probably a bad idea. So you want to consider how long you can survive or what you can cover in a situation like that, but also where you will hold those funds.