So, you’ve put in the work and built up an emergency fund of three to six months’ worth of your take-home pay (depending how stable your financial situation is). Now you’re like that super-prepared co-worker who always has an umbrella in her bag, even when the forecast is 70 and sunny. (Except this is an umbrella you worked really hard for.)

That pile of cash is ready and waiting for you when you need it — but there are all sorts of reasons you might “need it.” So how do you decide what’s an emergency and what’s … well … just not?

The obvious ones

First, there are undisputed financial emergencies: The things that come out of the blue, probably suck, and that you must pay for. Things like:

• You lose your job. Nobody wants to think about that possibility (and you’re probably slaying it) ... but it’s never out of the question.

• Your car or home needs to be fixed. (In fact, if you’re a homeowner, think about starting an entirely separate home maintenance emergency fund: 1% of your home’s value each year.)

• You or someone who depends on your income has a medical or dental emergency (fur babies definitely included).

• You have to travel unexpectedly, maybe because someone you love is sick.

• Another unforeseen but necessary expense pops up. Replacing a broken phone or laptop falls under most people’s “must buy immediately” category, for example.

The not-so-obvious ones

Okay: Medical stuff, job loss stuff, crucial broken stuff: Those are gimmes. But if it’s not a clear financial emergency, then what? Start by asking yourself two questions:

Is it expected or unexpected?

Expenses you can reasonably plan for are not emergencies. This falls into the “obvious” category when you’re talking about the electric bill, but it gets fuzzier with your $1,500-a-year car insurance premium that’s due all at once. If you haven’t saved up for it, using your emergency fund is better than putting it on a credit card.

It’s pretty easy to avoid surprising yourself next year, though: Jot down each of your larger, less regular expenses — including how much you’ll need and when they’re due. Count how many times you’ll get paid between now and each expense, and then transfer an equal amount out of every paycheck into a designated bank account.

Is it an expense (need) or an opportunity (want)?

We’ve all heard our emergency funds calling our name when there’s an one-in-a million opportunity to buy the shiny thing. (Looking at you, newly released “Hamilton” tickets at face value.) Hey, you tell yourself, at least you’re not putting it on a credit card, right? You built your emergency fund up once, and you can do it again.

If someone tells you they’ve never given in to such thoughts, they’re either lying or outrageously self-disciplined. But most of the time, it’s easy enough to tell Lin-Manuel no (if we must), and remember that an emergency fund is to keep “bad news” from turning into “really, really, really bad news.”

When it gets really tricky is that gray area between need and want — when you do, in fact, need something … and you also want the best version of it, or you want it NOW. Or someone who’s not you needs something.

Examples of the gray area:

• Your laptop breaks, and that top-of-the-line Apple product you’ve always wanted could help you expand your side hustle.

• Your car’s starting to need repairs more often than you’d like, just in time for those amazing end-of-model-year lease deals.

• Your doctor suggests a procedure she says has benefits but isn’t medically necessary.

• Someone you care about needs money — desperately.

• You’re excited about a business idea, but you feel like you’ll miss the opportunity if you take your time saving up to start it.

Navigating through “emergency-ish”

This is real life, and some things are going to fall squarely into the “ummmm, maybe an emergency” or “kinda depends who you’re asking” category. If you’re really twizzled, try these techniques to find clarity about the call you’re about to make:

• Think about what you’d say if a close friend came to you with this situation and asked for your advice. Would you tell them to spend the money?

• Imagine yourself a month from now if you make the decision to dip into your emergency fund. Do you feel relieved or guilty?

• List out all your financial goals and assign them a level of importance from 1 to 10. Then give the maybe-could-be-possibly-an-emergency a rating, too. How do they compare?

Getting back to that carrying-the-umbrella thing: Just because that umbrella saved you last week when “70 degrees and sunny” turned into an epic thunderstorm, you’re not about to thank it for services rendered and tenderly say farewell. It could still pour tomorrow. Use your emergency fund when you need to, and then build it back up again.

Disclosures