Financial experts say that you should pad your checking and savings accounts so that you have not only enough money to pay your regular bills, but also to pay insurance deductibles and emergency costs.
In 2-income families, it’s a good idea to sock away enough so that you could make ends meet should one of the wage earners become unemployed or physically unable to work.
However, financial planners differ in terms of how much they say you need to have in savings to weather the financial storms that might blow your way. If you’re single, a financial planner might recommend that you have 6 months to a year’s worth of extra cash on hand. If you’re married, you may need as little as 3 months’ worth of income tucked away in savings.
Still, experts admit it can be difficult to amass a large amount in savings. This is because many Americans live paycheck to paycheck. In addition, many are encountering extra expenses that they had not anticipated. For instance, with energy costs surging, many Americans are having to pay more than they budgeted for gasoline and home heating fuel.
Others are finding their savings zapped by the problems within the housing industry. A number of homes are sitting on the market awaiting buyers. In other cases, home sellers have been forced to dramatically drop their home prices in order to attract buyer interest. In still other cases, homeowners with adjustable rate mortgages are bracing for a $200-$300 rise in their monthly mortgage payments.
Still, experts say that there are some clever methods you can follow in order to establish a savings plan. One would be to “pay yourself first” each paycheck, taking part of your earnings and stowing them in savings. Another strategy is to pledge to spend more time entertaining at home, reducing the amount you spend on nights on the town. The money you save can then be invested in your savings account. Another winning idea is to sell some of your high-quality belongings on eBay to the highest bidder, using the money you earn to shore up your savings account.
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