Dec
10
2008
This article was from Consumer Reports, November 2008. It’s timely because I know many of you are looking for ways to access emergency funds without too many penalties. I thought you might be particular interested in the part about life insurance.
Suppose you’ve followed our common-sense advice about saving money for a rainy day and have an easy-to-access emergency fund that can cover your expenses for three to six months. What if that rainy day turns out to be a deluge? A medical emergency, a family crisis, or a devastating flood, for example. Where will you get the money to cover the costs of those unexpected events?
You might have cash invested in a 401(k), bank certificates of deposit, stocks, bonds, or even an insurance policy. But cashing in those assets comes at a price in the form of taxes, penalties, or lost investment opportunities. So, if possible, try to handle large unexpected expenses without dipping into your portfolio.
