Do you have a safety net?
Ask Dennis Farrah: What is a safety net and why do I need one?
When you are preparing for retirement, some things can look uncertain and there may be periods of time when you need to adjust to new income and expenses. This is exactly why it is important to have a safety net. You can not establish an emergency fund over night especially if you are starting with no savings. For true protection, you will want at lease three months of essential living expenses in the bank things like housing transportation food utilities and healthcare for better protection you should aim for six months of essentials.
How do I create a safety net?
Pay yourself first! Start putting at lease 15 percent of your earnings in the bank to create a healthy safety net. This way, you are tucking the money away before you even have a chance to spend it.
Retirement is a great transition, but don't get caught in a bad spot. One of the best ways you can prepare for retirement, or any financial situation, is by having a financial safety net.