Your O-line is your offensive line in football. These players protect the quarterback. They make a path for the running back, receivers, and tight-ends. Teams want to have big strong and fast offensive linemen to “battle” the other team’s defensive linemen. Just as a football team has a big strong O-line, you need to have one as well. No, I don’t mean that you need to go out and get a bunch of football players to protect you. What I mean is that you need a big strong emergency fund (O-line) in place to protect you from emergencies.
Having an emergency fund in place will provide you with peace of mind. When you’re faced with an emergency, you are able to cover the emergency. You’re not being rushed by the defense (the emergency). An emergency will no longer be able to sack you.
When you first start building an emergency fund, start by putting away $1,000. This is a starting point. Slowly, you are going to be adding to that fund, so that eventually you will have a fully-funded emergency fund. The emergency fund should be large enough to cover you for eight to twelve months of living expenses. That’s a fully-funded emergency fund.
Also, you want to make sure that your emergency fund has liquidity. Liquidity is a financial term. It just means that you are able to get your money fast without incurring any penalties or having to keep your money in a financial institution for a set time frame.
Save your money in a money market account that does not require you to maintain a certain balance or requires a large amount to open it. Make sure you don’t pay any fees to save your money. Keeping it at a discount broker is usually the best place. Banks tend to charge you fees to hold your money for you, so research the bank before you save your money with them.
Don’t keep your emergency fund at home or in your regular checking account. When you do, you will spend that money and your O-line will be either non-existent or made up of scrawny linemen. It won’t be able to handle any large emergencies. You want a tough O-line.