My “Peace of Mind” Fund: Built for Joy, Not Just “Oh No” Moments

Language and your choice of words are very important when it comes to personal finance and money management. Do you speak and think negatively when it comes to money, or are you more positive and think in terms of wealth abundance? I have personally realized that the way you speak about and approach money can make a big difference between attracting more money into your life or losing the little that you have.

This is why I don’t like to call it an emergency fund, but rather a “peace of mind” fund. That is literally what I have it labeled as. This is the fund I treat as: better to have and not need than to need and not have.

I chose this name because I felt like “emergency fund” sounded too negative and gloomy. Yes, it is meant to be used in cases of a real emergency where a large sum of money may be needed, like a major car repair bill, a furnace replacement, or even to cover expenses while you look for a new job. While these are real emergencies, we can also reword and rethink the way we think about them. Being able to cover a big bill feels more like peace of mind than focusing on the emergency itself. In fact, it is not only peace of mind—you feel a sense of power and control when you have enough money saved to cover such urgent and significant expenses.

A few months ago, we were faced with a major repair bill for one of our cars-something that came out of nowhere. But as painful as this was, we paid it with almost a smile on our face. Why smile, you may ask? It is that peace of mind and feeling of control that comes from being able to cover such a big bill without stress. I feel like calling it a “peace of mind” fund rather than an “emergency fund” is one reason there was an inherent feeling of pride and ease in being able to cover such a large expense.

Spend a week noticing how you talk and think about money, including how you have labeled your budgeting items, bank accounts, and investment accounts. Watch for negative labels and terms. Do you have a fund labeled “Retirement Account“? Go ahead and rename it to something like “Future Freedom Fund.” Subconsciously, over time, you may feel better and more secure about your finances, and that mindset may help you grow and multiply your wealth more easily.