The first step in any financial plan is to start building savings. Your goal should be to put away enough funds so that you can cover your expenses from 3 months up to 1 year.
Three months applies if you are married and both of you have stable, secure well-paying jobs. You should be able to cover 1 year if you are single and you work in a job that is unstable and you get paid commissions only. Obviously these are both extreme examples and everyone’s situation is unique.
Once you have funds to save don’t leave it in a checking account getting zero or near zero interest. Open an online savings account that is FDIC insured. As you can in the examples shown in the illustration, you can currently get more than 1% on your cash. Not much but better than nothing.
If you haven’t reviewed how an emergency fund is an integral part of your financial plan you should contact your CERTIFIED FINANCIAL PLANNER™ to get started.