< 1 minute read|Published by FAIRWINDS

5 Times Not to Use Your Emergency Fund

While it’s important to have an emergency fund, it’s also important to know how to use it wisely. See what things you should never use your emergency funds for.

Dollar Signs

Creating an emergency fund with at least $1,000 is the first and most important step on your journey to Financial Freedom. Having a separate Emergency Savings Account is essential to cover unexpected expenses such as emergency medical bills, car repairs, or job loss. That way, you’ll avoid putting those expenses on a credit card and paying more interest in the long run.

While it’s important to have an emergency fund, it’s equally important to know how to use it wisely. In fact, there are some things that you should never use your emergency funds for:

Non-Essential Purchases

The first thing you’ll want to avoid using your emergency fund for is non-essential purchases. Non-essential purchases are things you want but can live without. For instance, buying new electronics when your current ones are still working fine or taking a luxury vacation.

Paying Off Debt

That’s right, you should even avoid paying off debt with your emergency fund. Before paying off debt, it’s important to achieve Money Milestone 1 of saving $1,000 for emergencies and Money Milestone 2, maximizing your employer’s 401(k)/403(b) match. Once you reach Money Milestone 3, create a long-term plan to pay off debt using the Debt Snowball Calculator.


It’s important to connect with a financial advisor and invest in your future, but it’s equally as important to keep your emergency funds liquid and accessible. Keeping them readily available means you’ll always have access to your emergency savings when the unexpected happens, and you need them most.

Everyday Expenses

Rent, groceries, or utility bills are things that should be included in a regular monthly budget. If you’re relying on your emergency fund for these expenses, find ways to reduce costs, like reducing the number of streaming services you have or planning out your grocery list in advance to minimize impulse purchases.

Home Renovations

While unexpected home repairs would be considered an emergency, home renovations should be budgeted separately. If you’re looking to update your home, create a home renovation fund in a separate savings account or CD to help you reach your goals.

Remember, your emergency fund is there to help you out when something unexpected happens, like a sudden expense or life event. By keeping a separate savings account and using it just for emergencies, you can make sure that you have a financial safety net and peace of mind when you need it most.