Ask anyone who’s had a flat tire, a leaky roof, or an unexpected medical bill – having enough money tucked away in an emergency fund can prevent a lot of headaches. It may seem obvious to create a cushion for unexpected expenses while you’re saving up for retirement, especially if you have kids that need to get to their soccer games on time, a new-to-you home that’s really a fixer-upper, or an injury that catches you off guard. But an emergency fund is still important to keep after you retire!
Does your current retirement plan include an emergency fund for unexpected expenses like car trouble, home or appliance repair, or illness? Only 41% of Americans surveyed said they could turn to their savings to cover the cost of the unexpected. And 48% of Canadians reported that they are less than $200 from being unable to meet their current monthly bills. That means over 50% of Canadians and nearly 60% of Americans may need to turn to other methods of coverage like taking loans from family or friends or accruing credit card debt.
After you retire and no longer have a steady stream of income, covering unexpected expenses in full (without interest or potentially burdening loved ones) can become more difficult. And when you’re older, it might be more challenging to deal with some of the minor problems yourself if you’re trying to save some money! You’re probably going to need to keep the phone number for a good handyman, handy.
Don’t let an unexpected expense after retirement cut into your savings. A solid financial strategy has the potential to make a huge difference for you – both now and during your retirement.
Contact us today, and together we can put together a strategy that’s tailored to you and your needs.
Bankrate: "Bankrate survey: Just 4 in 10 Americans have savings they'd rely on in an emergency." 1.12.201