7 Justifiable Reasons to Dip into Your Emergency Fund ...

Some people only dip into their emergency fund when they need a car repair or need to cover a household expense. But if you have several thousand dollars in your emergency fund, dipping into your account isn’t the worst thing in the world. This is especially true if you're in a position to replenish any money taken from the account.
Here are seven justifiable reasons to dip into your emergency fund.

1. Take a Much Needed Vacation

If it's been years since you and your family had a vacation, this is one justifiable reasons to dip into your emergency fund. Yes, the money is primarily for a financial crisis. However, if a financial crisis never happens, the money will sit forever. If you have a sizable fund, withdrawing a modest amount to enjoy a little fun and relaxation is okay.

2. Pay off Income Tax

It doesn’t matter how much I set aside each year for taxes, I always end up owing more than anticipated. For those who owe taxes, the IRS offers provisions, such as installment plans. But if you don't want this debt hanging over your head for the next few years, go into your emergency fund and use this money to settle your balance.

3. Help a Friend or Family

This doesn't suggest giving money to every person in need. But if a close friend or relative experiences serious financial hardship, dipping into your emergency fund to help is commendable, and the person will no doubt appreciate any help they receive.

4. Buy Better Insurance Coverage

Never underestimate the importance of having insurance, whether it’s health insurance, renter’s insurance, or other types of insurance. To save money, some people purchase the cheapest policy possible. This offers immediate savings, but they might end up paying more in the long run. If you don't have adequate insurance, dip into your savings account and use some of the money to buy a better policy. Depending on the policy, you might pay your premium for a year in advance.

5. Pay off Credit Card Debt

Similar to an IRS balance, credit card debt can hang over your head for years. And as you pay off debt, you can rack up hundreds of dollars in interest charges. There is a better way. Go into your emergency fund and wipe the slate clean. Not only will paying off debt reduce interest charges, it’ll give your credit score a much needed boost.

6. Treat Yourself

When was the last time you bought an outfit for yourself? And if you like gadgets, when was the last time you purchased a toy for yourself? Building your savings is an excellent goal, but sometimes, we get so caught up in saving money that we forget to enjoy the fruits of our labor. If you have plenty in your fund, treat yourself to something special.

7. Pay Cash for a Car

If you’ve been saving for years, you might be able to pay cash for your car, and still have cash in your emergency fund. There are benefits to this approach. You don’t have to deal with credit checks, interest or monthly payments for the next 60 months.

Some people argue that you should never dip into an emergency fund. This is good advice, especially if you're in the early stages of building your account. But if you’ve been saving for years and have more than enough, what's the harm in taking a small amount for the things you need — or simply want? Do you think it's smart to dip into your emergency fund?