Stuff happens while we’re on the road. I’ve been caught in the midst of natural disasters (three, to be exact), been in hospitals (too many for my liking), had laptops destroyed, and worn through travel gear that needed immediate replacement regardless of whether it was convenient or cost-effective at the time.
And though (knock on wood) it hasn’t happened to me, there are also times when – no matter where you are, or what you’re doing – you need to go home. Immediately.
Sometimes, you simply must dip into your wallet whether or not you want to.
Whether or not you can is not a question that comes into play. You have to.
For these instances, having an emergency fund will be useful.
My rule of thumb for an emergency fund is to have the ability to get on a plane from anywhere in the world to home on a moment’s notice. If you have enough money to do that, you probably have enough money to cover off just about any emergency that comes your way.
Most of us don’t have a few thousand dollars kicking around “just in case”. If you do, great. Set it aside in a separate dedicated travel savings account reserved for emergencies, and you’re golden.
If you don’t have that sort of extra cash, an alternative is to carry a credit card with enough room to deal with emergencies, and never to spend beyond this emergency threshold. (If you carry a dedicated emergency credit card, make sure you still use it from time to time to avoid having it cancelled out from under you for non-use).