The reason why you should have an emergency fund, especially if you’re a court reporter, is to prepare for a loss in job, a medical emergency, car/appliances going out. If you don’t have this, you will get into credit card debt with a 20% interest rate or you will draw out of retirement with penalties, both equally bad. You need an emergency fund. This is the difference between living worry-free and constantly living check to check. Work as hard as possible, cut every expense possible, until you have this in your savings account. This needs to be in an account that you can draw out of easily with no penalty.
A lot of reporters do not have 401(k)s, but because we’re independent contractors, we are allowed to contribute more to our IRAs. Check with your accountant to see what the max you can contribute for your income level.
All of this is straightforward, except for the last bubble, which is investing. However, that is the last bubble and doesn’t come before you pay off all your loans, so you have plenty of time to figure that out. I will have two posts on just investing, covering investing for your kid’s college and retirement. Stay tuned.