[cute fuzzy bunny]

I think the key word here is "emergency" money.

I dont plan on tapping the heloc or reverse mortgaging my house, but under certain circumstances its an option.

Given a situation where someone might have 3-4 months worth of expenses...or 2-3 years worth if they have a lot of leverage by investing their mortgage and need to protect themselves from protracted downturns in the market. Unless cleverly invested (with a degree of luck) at good rates in longer term cd's, most peoples cash is losing ground to inflation.

For something they might probably never use.

I'd rather let the bank be my lender of last resort at a reasonable rate for something I have a <5% chance of using, than lose value on my money every month with 100% certainty.

If and when I hit a situation where I'm faced with "okay, checking account is empty, markets are down so I dont want to sell any investments right now, I have some bills to pay", I can either sell something, get a temporary PT job, use the heloc, use my overdraft/line-of-credit, use a credit card, or any one of another dozen options.