March 2020
Financial Planning

Emergencies, by their nature, are unpredictable. When they happen, they can derail your financial stability. A sudden illness or accident, unexpected job loss, or even a surprise home or car repair can devastate your family’s day-to-day cash flow if you aren’t prepared. 

While the size of your emergency fund will vary depending on your lifestyle, monthly costs, income, and dependents, the rule of thumb is to put away at least three to six months’ worth of expenses. This amount can seem daunting at first, but the idea is to put a small amount away each week or two to build up to that goal. You may also want to consider adjusting the amount based on your bill obligations, family needs, job stability, or other factors. 

Emergency savings are best placed in an interest-earning bank account, such as a money market or interest-earning savings account, that can be accessed easily without taxes or penalties. The concern with placing your emergency savings in investment accounts, is that they may lose value if the funds needed. Always remember, something is better than nothing. 

While the hope is to never need these funds for something sudden or unexpected, any successful financial plan will always seek to mitigate risk. If you are unsure how much you should be setting aside in your own personal emergency fund, call as at the office to discuss! 

If you have questions, please contact us.

MARKET UPDATE
COLLEGE AND TAX PLANNING
401(k) ALLOCATION
GRAPHIC OF THE MONTH

To download the March 2020 Newsletter: CLICK HERE