When it comes to building an emergency fund, there are two schools of thought. First there is the “live dangerously” crowd who like to rely on a credit card for emergencies and then invest everything else.
Start building your emergency fund now. You'll be glad you did, if not for this crisis, then for the next one.
The more fearful, or sensible crowd, depending on your point of view, says you should have between three to six months of expenses in a savings account or readily accessible cash. Then you can invest the rest.
Personally, I’m the fearful type, though I take it to another level entirely with up to three years of expenses saved in cash at this moment. And, boy, am I glad of that.
The “live dangerously” crowd extoll the possibility that if you had to tap into your emergency fund due to job loss, you could then sell some stocks and bonds to cover your needs until you were employed again.
In these Covid-19 times, however, it seems the perfect storm has hit, and those who lived this way are now in a very dangerous financial situation. Job losses are here, the markets have crashed, and many are now wishing they had cash saved up for this torrentially rainy day.
There are three main reasons why having an emergency fund right now is fantastic. If you don’t have one, then hopefully this line of thinking will help motivate you to build yours.
Reason 1. 'I don’t have to sell stocks when the market is down'
Right now, I am not even glancing at the value of my stocks and bonds. With three years of expenses saved up, I don’t need to withdraw from my trading account, so its value does not matter.
I’m still receiving dividends, even if they’re diminished, so it means I am buying more stocks at a steep discount. I should be buying more right now, but for my mental health, I want to keep my emergency fund as flush as possible, which means deferring buying for a bit. I may miss out on stocks being on sale, but I need to be able to sleep at night more.
Reason 2: 'I don’t have to worry about losing my job'
Rather than fearing redundancy, my emergency fund gives me the option to take a sabbatical if I want to. I already have a teaching contract secured for the next two years, the catch is that it’s at a school in China. It's a great school, which I’m sure will survive this struggle, but I’m not positive I’ll be able to get to China if international travel continues to tighten. So, I’m gearing up for that job to evaporate. Thankfully, because of my emergency fund, I can afford to take a year off. A sabbatical to hunker down and ride out the storm without a lot of responsibilities sounds pretty great. There will be a hammock involved. Instead of looking at a lack of a job with fear, I’m seeing it as an opportunity.
Reason 3: 'Building it up taught me valuable financial skills'
You cannot build an emergency fund without having some key financial skills. You need to know how to track your spending, cut your outgoings and live below your means, or you’ll never save enough. All of these skills are critical right now to help me weather this storm and come out the other side.
I know I’m very lucky to have a job. I know I’m lucky to have my health. I know I’m lucky to have a roof over my head. If you’re similarly lucky, use that luck and start building your emergency fund now. You’ll be glad you did, if not for this crisis, then for the next one.
Dubai schoolteacher Zach Holz (@HappiestTeach) documents his journey towards financial independence on his personal finance blog The Happiest Teacher
Company Profile:
Name: The Protein Bakeshop
Date of start: 2013
Founders: Rashi Chowdhary and Saad Umerani
Based: Dubai
Size, number of employees: 12
Funding/investors: $400,000 (2018)
The President's Cake
Director: Hasan Hadi
Starring: Baneen Ahmad Nayyef, Waheed Thabet Khreibat, Sajad Mohamad Qasem
Rating: 4/5
F1 The Movie
Starring: Brad Pitt, Damson Idris, Kerry Condon, Javier Bardem
Director: Joseph Kosinski
Rating: 4/5
Our legal columnist
Name: Yousef Al Bahar
Advocate at Al Bahar & Associate Advocates and Legal Consultants, established in 1994
Education: Mr Al Bahar was born in 1979 and graduated in 2008 from the Judicial Institute. He took after his father, who was one of the first Emirati lawyers
World record transfers
1. Kylian Mbappe - to Real Madrid in 2017/18 - €180 million (Dh770.4m - if a deal goes through)
2. Paul Pogba - to Manchester United in 2016/17 - €105m
3. Gareth Bale - to Real Madrid in 2013/14 - €101m
4. Cristiano Ronaldo - to Real Madrid in 2009/10 - €94m
5. Gonzalo Higuain - to Juventus in 2016/17 - €90m
6. Neymar - to Barcelona in 2013/14 - €88.2m
7. Romelu Lukaku - to Manchester United in 2017/18 - €84.7m
8. Luis Suarez - to Barcelona in 2014/15 - €81.72m
9. Angel di Maria - to Manchester United in 2014/15 - €75m
10. James Rodriguez - to Real Madrid in 2014/15 - €75m
What are NFTs?
Are non-fungible tokens a currency, asset, or a licensing instrument? Arnab Das, global market strategist EMEA at Invesco, says they are mix of all of three.
You can buy, hold and use NFTs just like US dollars and Bitcoins. “They can appreciate in value and even produce cash flows.”
However, while money is fungible, NFTs are not. “One Bitcoin, dollar, euro or dirham is largely indistinguishable from the next. Nothing ties a dollar bill to a particular owner, for example. Nor does it tie you to to any goods, services or assets you bought with that currency. In contrast, NFTs confer specific ownership,” Mr Das says.
This makes NFTs closer to a piece of intellectual property such as a work of art or licence, as you can claim royalties or profit by exchanging it at a higher value later, Mr Das says. “They could provide a sustainable income stream.”
This income will depend on future demand and use, which makes NFTs difficult to value. “However, there is a credible use case for many forms of intellectual property, notably art, songs, videos,” Mr Das says.
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'Shakuntala Devi'
Starring: Vidya Balan, Sanya Malhotra
Director: Anu Menon
Rating: Three out of five stars
The Perfect Couple
Starring: Nicole Kidman, Liev Schreiber, Jack Reynor
Creator: Jenna Lamia
Rating: 3/5
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
