ST. LOUIS – The COVID pandemic shed light on how much money people need to have stashed away for emergency use only. Unfortunately, a lot of Americans were put in tough financial positions the past year and a half.
While everyone’s situation is different, certified financial planner Travis Freeman with Moneta said a good rule of thumb is to have at least a few months of living expenses, like rent, utilities, and other necessities in an emergency savings fund.
Freeman recommends if it is a two-income household, they should have three months of variable and fixed expenses saved up. If it’s only one income in a household, Freeman recommends having six months of variable and fixed expenses saved up.
Freeman said while the thought of putting aside three to six months of expenses seems insurmountable for some, you can start slow, putting even a small amount aside. He suggested even looking around the house for items you don’t use and sell them.
Freeman said the key to having an emergency savings fund ready is to keep it completely separate from other finances.
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