GOLDEN VALLEY, Minn. — It's no secret that Americans are increasingly challenged when it comes to making financial ends meet. With the rising cost of food, housing and other necessities - combined with the impact of inflation - many are living from paycheck to paycheck, without a cushion if something were to happen.
According to financial planner Ayo Idowu, that underlines the importance of establishing an emergency fund. Just how much that is depends on whether you are single with few financial responsibilities, or someone with a family, kids, a mortgage and car payment.
He suggests:
- Those who are younger with fewer responsibilities should aim for having enough to cover three months of living expenses (not income)
- Folks with homes, cars, kids and other obligations should shoot for an emergency fund that can cover six months of living expenses
If you're wondering where to find money to fill that fund, Idowu suggests being creative. He is currently in the midst of an "October Fast" with fewer social outings, eating at home instead of out, putting travel on hold and putting all the money saved into his emergency fund.
If you have questions, check out Ayo Idowu's web page at Integrate Wealth Management.