How Much Emergency Savings Should You Have?:
Reprinted by permission from the publisher John Wiley & Sons, Inc., from The Ultimate Financial Plan by Jim Stovall and Tim Maurer. Copyright (c) 2011 by Stovall and Maurer.
By Jim Stovall and Tim Maurer
So what have you heard about emergency reserves? Rules of thumb range from one to 12 months, and no one seems to know what they need. And, is it three months of expenses or income? This and most rules of thumb in personal finance are over-simplifications often tossed aside because of their impersonal feel. We'll tell you what you should have for your emergency reserves (and why you should have it) and rely on your intimate knowledge of your own finances to help dictate your ultimate course....
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