COLORADO SPRINGS – It’s something that many Americans fail to have – an emergency fund.
It’s money you should have tucked away for those unforeseen life events.
“You really need to plan on the unexpected,” said Carl Carlson, CEO of Carlson Financial. “That could be something like all of a sudden you lose a job or your car breaks down, your house has an issue, you need a new roof or a new HVAC system.”
It’s times like these when an emergency fund will come in handy.
Carlson said if you don’t have one set up “your credit cards start building up.”
It can be a pretty slippery slope from there.
“They’re going to start wanting their payment or you’re going to get collection letters. They’re going to want to foreclose on that mortgage. You just don’t want things like that happening.”
So start putting money into an emergency fund sooner rather than later.
“Some say three months worth of income…some say six months.”
The amount may be different for everyone, but a universal truth is that we all need to plan for the unknown.
Carlson said if you’re a homeowner that’s even more of a reason to have an emergency fund and also if you have kids. Make sure you have enough to cover them and even encourage them to start their own fund as well.
Carlson Financial is a sponsor of Financial Focus.