Emergency savings are key to have for the unexpected: car repairs, medical expenses, or a job loss, for example. It's good to have three to six months' worth of expenses in an emergency fund. Say your monthly expenses are $2,000. Then you want to have $6,000 to $12,000 in an account that you can access at any time at the local bank. Three to six months is generally the minimum. It's good to work up to a year's worth of expenses in savings.
Put these funds in the local bank where you can access them at any time. You might want to put the first three months in a basic savings account. Banks offer Certificates of Deposit (CD's) for different time periods. After you open up the savings account for the initial three months, you could then open up a 3-month CD, 6-month CD, etc. as you build toward having a year's worth of savings in the bank.
Copyright 2012 Connie Livingston All rights reserved
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