Reasons You Might Need an Emergency Fund

Shanna Davis • December 4, 2018

You’ve heard the horror stories: basement floods gone wrong, cars that randomly stop running, or a pal suddenly losing their job. Perhaps you’re the type of person who thinks “that will never happen to me!” when hearing one of these stories, but the cold reality is that it very well could happen to you.

But don’t panic! All you need is a little money stashed away that most people dub the “emergency fund”. The word emergency can sound a bit frightening, but what it really comes down to is making sure you have some funds set aside just in case something happens that’s suddenly out of your financial control.

So what exactly warrants having some extra cash on hand? We knock out a few of those horror stories below.

You Or Your Partner Become Unexpectedly Pregnant

Surprise! The gift of life has arrived , the only problem is — you aren’t prepared. In a situation where you don’t want to panic more than you already are, lean on the weight of your emergency stash to ease the reaction of surprise news.

You Become a Victim of Identity Fraud

Never something you want to have to think about, but you can never be too careful. If you’re the unfortunate victim of identity fraud you may find yourself in a situation where all of your cards are tied up. Having some extra cash on the side will help ease the stress of an unfortunate situation.

Your Home Requires An Unplanned Repair

Being a homeowner means being fully aware that things can change in your environment at any time, and that means unplanned repairs. Whether it’s a roof that needs replacing or a flood in the basement, having the extra funds to cover off unexpected expenses is key

You Have To Take An Unplanned Flight

Varying life circumstances may force you to take a flight at a moment’s notice. In these times, don’t get stuck charging travel to your credit card. Having the money to book a flight whenever necessary could make the difference between a peaceful and not-so-peaceful duration of your flight.

You Find Yourself Stuck With a Major Health Expense

Canadians are lucky to have the benefits of a country-wide health care plan, but there are some things OHIP simply won’t cover like crutches, casts, splints, physiotherapy, dental care, etc. If you aren’t entitled for additional benefits with your employer, you will certainly want to be prepared for these expenses and more when it comes to medical assistance.

Your Car Needs Repairs or Breaks Down Entirely

It’s very possible you’ve found yourself in this position before, and if you didn’t have funds lined up to deal with the damages, you will most certainly know the cost of being unprepared. Don’t make the same mistake twice.

You Lose Your Job

Perhaps the most common reason to have some money set aside is if you unexpectedly lose your job. It’s suggested that the ideal amount to have ready in this situation is three to six months worth of your salary. If that’s unrealistic for you, think about what is realistic and begin working toward that.

Of course, there are other circumstances we haven’t listed here when an emergency fund is necessary. The moral of the story is, saving a sum of money for situations out of your control is something worth investing in.

This article was written by Shorey Andrews and originally appeared on the Nest Wealth blog on August 30th, 2017.

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How Your Loans and Spending Habits Are Quietly Shaping Your Credit Score

By Shanna Davis • April 10, 2026

Your credit score is one of the most important numbers in your financial life — especially when it comes to getting a mortgage. But for most Canadians, how that number actually gets calculated remains a bit of a mystery.

Everything You Should Know Before Buying a Home

By Shanna Davis • April 9, 2026

Thinking About Buying a Home? Here’s What to Know Before You Start Whether you're buying your very first home or preparing for your next move, the process can feel overwhelming—especially with so many unknowns. But it doesn’t have to be. With the right guidance and preparation, you can approach your home purchase with clarity and confidence. This article will walk you through a high-level overview of what lenders look for and what you’ll need to consider in the early stages of buying a home. Once you’re ready to move forward with a pre-approval, we’ll dive into the details together. 1. Are You Credit-Ready? One of the first things a lender will evaluate is your credit history. Your credit profile helps determine your risk level—and whether you're likely to repay your mortgage as agreed. To be considered “established,” you’ll need: At least two active credit accounts (like credit cards, loans, or lines of credit) Each with a minimum limit of $2,500 Reporting for at least two years Just as important: your repayment history. Make all your payments on time, every time. A missed payment won’t usually impact your credit unless you’re 30 days or more past due—but even one slip can lower your score. 2. Is Your Income Reliable? Lenders are trusting you with hundreds of thousands of dollars, so they want to be confident that your income is stable enough to support regular mortgage payments. Salaried employees in permanent positions generally have the easiest time qualifying. If you’re self-employed, or your income includes commission, overtime, or bonuses, expect to provide at least two years’ worth of income documentation. The more predictable your income, the easier it is to qualify. 3. What’s Your Down Payment Plan? Every mortgage requires some amount of money upfront. In Canada, the minimum down payment is: 5% on the first $500,000 of the purchase price 10% on the portion above $500,000 20% for homes over $1 million You’ll also need to show proof of at least 1.5% of the purchase price for closing costs (think legal fees, appraisals, and taxes). The best source of a down payment is your own savings, supported by a 90-day history in your bank account. But gifted funds from immediate family and proceeds from a property sale are also acceptable. 4. How Much Can You Actually Afford? There’s a big difference between what you feel you can afford and what you can prove you can afford. Lenders base your approval on verifiable documentation—not assumptions. Your approval amount depends on a variety of factors, including: Income and employment history Existing debts Credit score Down payment amount Property taxes and heating costs for the home All of these factors are used to calculate your debt service ratios—a key indicator of whether your mortgage is affordable. Start Early, Plan Smart Even if you’re months (or more) away from buying, the best time to start planning is now. When you work with an independent mortgage professional, you get access to expert advice at no cost to you. We can: Review your credit profile Help you understand how lenders view your income Guide your down payment planning Determine how much you can qualify to borrow Build a roadmap if your finances need some fine-tuning If you're ready to start mapping out your home buying plan or want to know where you stand today, let’s talk. It would be a pleasure to help you get mortgage-ready.