george hayduke
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I'd say a realistic emergency fund should be around 1000 - 3000 dollars. Any less than a grand and you run the risk of having to tap into illiquid assets or lines of credit any more than 3k and you are giving too much opportunity for your money to grow.
the general rules that i follow as far as savings:
emergency fund - 3k in on-line savings account look at HSBCDirect @ 4.5%
unemployment fund - 2 months salary 50-50 stock and bond funds you want to minimize volatility so look for a mean efficent portfolio (look for a MVO optimizer to help)
every month:
first maximize your 401k - regardless of what popular rules of thumbs i think you would be hard pressed to beat 100% stock funds over the long haul.
once all that is taken care of then tackle roth IRA and 529s for kids.
thanks
george
cheif technology officer
http://www.doodlebugdezigns.com |
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Rick B
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Follow Dave Ramsey's baby steps.
1) $1,000 emergency fund
2) Pay off all debts except the house
3) Increase your energency fund to 3 to 6 month's worth of expenses (in a money market account!) |
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That Guy
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6 months expenses.... |
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Common Sense
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Six months of "expense" money... or more (the better).
This is a question only you can answer. The "trick" here is not to fool yourself! |
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iphone man
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If you have kids then you need at least $500,000. |
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Fire's Shaddow
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3-6 depending on your bills and salery. Unfortunatly the less you make the more you should put away for emergencies because rent and other necesities take up a larger percentage of your income. |
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gamer9238740
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it depends on the net income and what emergencies are possible for you to incure, you need to weigh the probability that an emergency will occur and how severe and costly it might be against how much you can afford to save |
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gabound75
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2 months salary. Then start investing after you've built up to that. If you have to dip into it, stop investing so you can build it back up, then go back to investing. That way you have liquid assets when you need them. That investment money is hard to get ahold of when you need it fast, but it grows much better than a savings account and will help you out when you're older or need to help the kids out for college |
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SpiderDijon
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think about how long it would take you to save up money in case of an emergency. it would probably take quite some time, and what happens if you have an emergency BEFORE you save up 'enough'? in my experience, i've found that in case of an emergency, the best thing to have a is a credit card with a low interest rate and high credit limit. that way you can take your time paying off a hospital visit or emergency car repair. people say that the best thing to do is save 6 months worth of your income in preparation for an emergency, or if you or a spouse is all of a sudden out of work. personally, i don't think this is feasible unless you are childless, debtless, and single. all of which i am not. i make decent money, as does my spouse, but between car payments, daycare, utilities, student loans, insurance, and whatever other bills pop up, it would take years to save up 6 months worth of income. it's just not gonna happen.
but if you are single, childless, and out of debt, you can save up as much as you're willing to. if you live meagerly, it's pretty easy to save. there are a lot of things you can live w/out like cable tv, a new pair of shoes to add to the dozen you probably alredy own, the pint of ben and jerry's you don't really need, the gym membership you could swap out for free reign of a sidewalk to jog on, etc.
having a credit card for emergencies ONLY is also a good way to establish credit as long as you abide by the emergencies only standard and make payments higher than the minimum. i read, i think on yahoo financial actually, that saving 6 months pay for emergencies is idealogical but not particularly attainable. |
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Kid Zero
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i would say a couple months rent and bills incase you lose your job or something unecpected, but hey we live in america so do the best you can, i try to do half and half, whatevers in my checking i "try" to keep the same in my savings. |
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Uncle Leo
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Three to six months living expenses is the amount that is usually recommended. The idea is that if you lose your job, you'll need about that much time to find a new job. So you should have several months of expenses saved up. If you don't like the idea of a savings account, think about putting the money in a money market fund or other short term investment. |
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garrisonbight
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A minimum of two MONTHS expenses is generally a decent figure to start with... but you can save more... you can always spend the extra money, if necessary |
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~Hobo_Blood~
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start with $1000 this will cover basic things like your kid breaking a led or your transmission goes out, but ideally you want to have 1 years worth of expenses. Huge goal, yes, but then you would never ever have to worry aobut what to do if/when you loos your job. start w 1000 and keep adding till you have a MINIMUM or 3 months worth of expenses. if all income ceased tomorrow, how much money would it take to keep up your standard of living for 3 months? thats a good minimum once you got your $1000 cushon. |
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Mario R
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3 months of household income is our recommendation. But to get to this point you need to payoff all high interest rate credits first. Then save as much as you can to payoff all bills with higher interest than what you collect from your CD's. Your only main interest should be on a homeowner mortgages that are tax deductible (not all are!!!)
The fact is you need insurance against all your unforeseen accidental expenses or we call it self insurance... We have many other ways to correctly setup your income vs. expenses and justify savings... You can visit these people:
http://www.insuremeusa.com
http://www.worldsinsurance.com
http://www.worldsinsurancegroup.com |
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steven_primm
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The answer to your question is actually another question. How long will it take you to find a job that pays as the one that you have now? Of course more is better. |
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GG
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if you can afford it, i personally believe the right amount is at least (bare minimum) 2 months of rent/mortgage and utilities. |
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quiksilver23
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1,000 is good .....most things like fiking your car is expensive |
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Mirabella Brandybuck
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As much as you can spare. No less than $1,000 set aside, in my opinion.
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