events and opportunities fund

There are a few accounts that households should have set aside for different purposes. We’ve talked about the Emergency Fund and the Rainy Day Fund, and in the future, we’ll address funds for specific purposes or goals. Today let’s cover the Events and Opportunities Fund.

An Events and Opportunities Fund can be helpful to take some pressure off some financial decisions. However, it probably ranks below the Rainy Day funds and definitely below the Emergency Fund in terms of importance.

What is an Events and Opportunities Fund? 

An Events and Opportunities fund is used for things that come up that are unexpected but not emergencies. The event or opportunity would benefit you if you could participate, but it won’t leave you worse off if you don’t participate.

When to use your Events and Opportunities Fund

Events and experiences

Here’s an example. Taylor Swift is currently on tour as I write this article. Tickets for her concerts cost a pretty penny if you can get them, but they have been incredibly difficult to get. Many who anticipated this concert and set aside funds for the tickets haven’t been able to actually get the tickets. You would love to go, and even more so, your daughter would love to go. But you didn’t set aside funds for this financially, and you wouldn’t even know where to start looking for tickets once the usual channels are exhausted.

Now, imagine that the day before the concert, you get a call from a friend. They have tickets for the concert, but they have COVID and won’t be going anywhere for a few days. They offer you the tickets at a fair price (fair is all relative). What do you do? If you decide that you will benefit from going to this concert (enjoyment, memories, etc.), then you use your Events and Opportunities Fund. This allows you to buy the tickets from your friend, give them your wishes for a speedy recovery, and go enjoy the concert.

Unscheduled Opportunities

Or, here’s another example.

events and opportunities fund - an essential household accountThe Smiths decided that they’d like to install a pool next summer. They started getting quotes in the fall and ran into two issues. First, the cost was much higher than they anticipated because pools and their installers became much more in demand during the pandemic. 

Second, the pool companies were unavailable until after they wanted it installed. Due to the increased demand and timing, they pretty much gave up on the idea. Then one of the companies reached back out to them because, as it turned out, they would be installing pools for two other neighbors very close by. Because the equipment and workers would already be in the neighborhood, the pool company would be able to install their pool at a better price than originally quoted. But only if it was at the same time the neighbors were having their pools installed. The installation date was in the spring, so they would even be able to use the pool the following summer. This meant the Smiths would get their pool, but it would be sooner than expected. Once more, this would be a good use of your Events and Opportunities Fund.

More examples

Other examples include types of entertainment events, opportunities to travel, and purchases that didn’t make your list of specific goals where an opportunity presents itself and is mutually beneficial to you and the seller. In some cases, investment opportunities (well-vetted and aligned with your risk tolerance and overall financial plan) present themselves.

Again, this type of fund is intended to take some pressure off financial decisions, but not all. You must decide if the presented opportunity or event is worth your hard-earned dollars. The difference is that if you have the funds for these events and opportunities as they present themselves, you won’t derail the rest of your financial plan. 

This article is intended to be educational and thought-provoking rather than financial advice.  When we work together in a financial planning engagement, we discuss your unique personal situation and your unique goals.  During our financial planning process, we examine these factors and many others to determine appropriate financial strategies for YOU.

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