WEBVTT 00:00:00.480 --> 00:00:03.280 Hello and welcome. Can you feel it? 00:00:03.280 --> 00:00:05.440 That's the excitement of retirement and 00:00:05.440 --> 00:00:07.600 it's right around the corner. You've 000:00:07.600 --> 00:00:09.840 worked for decades. You've saved and 00:00:09.840 --> 00:00:12.559 you've planned. But there's one critical 00:00:12.559 --> 00:00:15.280 final sprint you need to make in this 00:00:15.280 --> 00:00:18.960 last year to ensure a smooth and worryf- 00:00:18.960 --> 00:00:22.240 free transition. And that's building a 00:00:22.240 --> 00:00:25.199 robust emergency fund. Now, you might 00:00:25.199 --> 00:00:27.680 think you've already done this, but a 000:00:27.680 --> 00:00:30.720 retirement emergency fund is different. 00:00:30.720 --> 00:00:33.120 It's not just a buffer. It's your 00:00:33.120 --> 00:00:36.079 financial fortress, and it protects you 00:00:36.079 --> 00:00:38.800 from a world where you no longer have a 00:00:38.800 --> 00:00:42.160 regular paycheck to fall back on. So, 00:00:42.160 --> 00:00:44.879 today, I'm going to break down exactly 00:00:44.879 --> 00:00:47.280 why you need this fund and how to build 00:00:47.280 --> 00:00:53.520 it in just 12 months. 00:00:53.520 --> 00:00:55.840 So, why is your emergency fund such a 00:00:55.840 --> 00:00:59.280 top priority now? Well, in the working 00:00:59.280 --> 00:01:01.520 world, an emergency fund gives you a 00:01:01.520 --> 00:01:03.760 cushion. In retirement, it's 00:01:03.760 --> 00:01:07.040 non-negotiable. It's a safety net. Why 00:01:07.040 --> 00:01:09.040 is this? Well, 00:01:09.040 --> 00:01:11.280 first, there's a lack of a steady 00:01:11.280 --> 00:01:13.840 regular income. Without that regular 00:01:13.840 --> 00:01:16.240 paycheck, a single unexpected expense 00:01:16.240 --> 00:01:19.520 like a major car repair or a sudden 00:01:19.520 --> 00:01:21.920 dental bill can force you to tap into 00:01:21.920 --> 00:01:25.200 long-term savings or even worse, your 00:01:25.200 --> 00:01:29.360 carefully managed investment portfolio. 00:01:29.360 --> 00:01:32.799 Secondly, an emergency fund protects 00:01:32.799 --> 00:01:35.600 your investments from market volatility. 00:01:35.600 --> 00:01:38.880 Now imagine the market takes a dip right 00:01:38.880 --> 00:01:41.920 when you need to cover a new roof for 00:01:41.920 --> 00:01:45.040 your home. Without liquid cash, you 00:01:45.040 --> 00:01:47.200 might be forced to sell your stocks or 00:01:47.200 --> 00:01:49.840 bonds at a loss, 00:01:49.840 --> 00:01:56.079 permanently damaging your nest egg. 00:01:56.079 --> 00:01:58.640 Your emergency fund acts as a vital 00:01:58.640 --> 00:02:01.200 firewall, keeping your retirement 00:02:01.200 --> 00:02:05.840 savings safe and untouched. 00:02:05.840 --> 00:02:09.038 So, let's talk about the 12 month action 00:02:09.038 --> 00:02:12.160 plan. 00:02:12.160 --> 00:02:14.560 So, how do you get this done in just one 00:02:14.560 --> 00:02:18.000 year? Now, here's a simple three-step 00:02:18.000 --> 00:02:27.760 plan. One, set your target number. 00:02:27.760 --> 00:02:30.400 Forget the old rules of thumb. Your 00:02:30.400 --> 00:02:33.280 retirement emergency fund should cover 00:02:33.280 --> 00:02:36.480 between six and 12 months of your 00:02:36.480 --> 00:02:39.200 essential retirement expenses. That 00:02:39.200 --> 00:02:42.160 means things like your housing, your 00:02:42.160 --> 00:02:44.400 utilities, your groceries, and 00:02:44.400 --> 00:02:46.160 healthcare. 00:02:46.160 --> 00:02:48.480 And why essential expenses? Because 00:02:48.480 --> 00:02:51.200 those are the costs you absolutely 00:02:51.200 --> 00:02:54.959 cannot avoid. Calculate this number now 00:02:54.959 --> 00:03:00.480 and make it your mission. 00:03:00.480 --> 00:03:04.159 So step two is to start the saving 00:03:04.159 --> 00:03:08.159 sprint. Now with your number in hand, 00:03:08.159 --> 00:03:10.480 it's time to get aggressive for the next 00:03:10.480 --> 00:03:12.319 12 months. 00:03:12.319 --> 00:03:16.000 Automate your savings. Set up a monthly 00:03:16.000 --> 00:03:18.640 transfer from your current account to 00:03:18.640 --> 00:03:21.280 your emergency fund. This kind of makes 00:03:21.280 --> 00:03:25.599 it automatic and non-negotiable. 00:03:25.599 --> 00:03:28.319 Re-evaluate your spending. Look at your 00:03:28.319 --> 00:03:31.360 budget with a critical eye. Can you cut 00:03:31.360 --> 00:03:35.280 back on dining out, subscriptions, or 00:03:35.280 --> 00:03:38.080 other non-essentials for the next year? 00:03:38.080 --> 00:03:41.840 This is the final push. 00:03:41.840 --> 00:03:44.959 What about one-time windfalls? Do you 00:03:44.959 --> 00:03:49.120 have a work bonus, a tax refund, or any 00:03:49.120 --> 00:03:51.680 other one-time payment coming in? then 00:03:51.680 --> 00:03:54.480 redirect it straight into your emergency 00:03:54.480 --> 00:03:57.280 fund. 00:03:57.280 --> 00:04:00.239 Step three is then to find the right 00:04:00.239 --> 00:04:05.280 home for your cash. 00:04:05.280 --> 00:04:08.080 So your emergency fund needs to be in a 00:04:08.080 --> 00:04:12.480 lowrisk liquid place. This is not for in 00:04:12.480 --> 00:04:15.439 long-term investing. This is for easy 00:04:15.439 --> 00:04:18.399 access. Now some of the options for you 00:04:18.399 --> 00:04:22.079 may be a high yield savings account. 00:04:22.079 --> 00:04:24.320 These offer a better interest rate than 00:04:24.320 --> 00:04:26.880 a standard savings accounts helping you 00:04:26.880 --> 00:04:30.080 to grow money with only slight amount of 00:04:30.080 --> 00:04:32.880 risks. Then there's one of my favorites 00:04:32.880 --> 00:04:35.600 which is the money market accounts and 00:04:35.600 --> 00:04:38.240 these are another lowrisk option that 00:04:38.240 --> 00:04:40.880 provide easy access to your funds and we 00:04:40.880 --> 00:04:43.440 talk about market money accounts quite a 00:04:43.440 --> 00:04:47.600 lot on this course. The key is that the 00:04:47.600 --> 00:04:50.639 money is safe and instantly accessible. 00:04:50.639 --> 00:04:53.040 You can't afford to wait for a brokerage 00:04:53.040 --> 00:04:55.759 to settle a trade. So, where are we 00:04:55.759 --> 00:05:01.840 trying to get to? Peace of mind. 00:05:01.840 --> 00:05:03.600 So, let's think about what this 00:05:03.600 --> 00:05:07.039 emergency fund truly brings you. It buys 00:05:07.039 --> 00:05:10.400 you the freedom to enjoy your retirement 00:05:10.400 --> 00:05:12.880 without the nagging fear of the 00:05:12.880 --> 00:05:14.479 unexpected. 00:05:14.479 --> 00:05:17.199 It means that when you do get a surprise 00:05:17.199 --> 00:05:20.720 bill or there's a market downturn, your 00:05:20.720 --> 00:05:23.360 first thought is not, oh, how am I going 00:05:23.360 --> 00:05:25.759 to pay for this? But rather, thank 00:05:25.759 --> 00:05:29.039 goodness that I had prepared for this. 00:05:29.039 --> 00:05:32.320 Think of it as the final gift you can 00:05:32.320 --> 00:05:35.280 give yourself as you step into the next 00:05:35.280 --> 00:05:38.880 chapter of life. So, let's start your 12 00:05:38.880 --> 00:05:42.560 month sprint today. 00:05:42.560 --> 00:05:44.720 Now, don't forget to read through the 00:05:44.720 --> 00:05:46.720 rest of the course and the infographics 00:05:46.720 --> 00:05:49.600 in the section and also have a little go 00:05:49.600 --> 00:05:51.919 at the quiz as well and revisit any 00:05:51.919 --> 00:05:53.600 areas that you're not sure about when 00:05:53.600 --> 00:05:55.759 you do go for the quiz. And I'll see you 00:05:55.759 --> 00:05:58.000 down on the next section.