How confident are you that you could come up with $2,000 if an unexpected expense arose next month?

Click “Launch Infographic” to see a visual comparison of how well Americans are preparing for their rainy day.

Forget scary movies -– have you dared to look at your 401k statements lately?

The financial headlines keep getting more frightening, and the numbers on your retirement accounts are probably more red than green these days. Sometimes it’s enough to make you want to throw in the towel on your savings goals.

But financial experts say that’s the last thing you should do when times get tough. Instead, refocus your efforts and revise your goals if you must -– but don’t abandon savings altogether. Here are some key things to keep in mind when you’re tempted to take your money and run:

Use the economic slump as an excuse to re-focus your goals

When your financial situation takes a hit — that’s the time to investigate where your money is going. Determine whether there are areas where you can cut back before you consider revising your savings goals, said Andrew Schrage, editor of Money Crashers.

“Every dollar that you do not save is a missed opportunity that puts you even further behind in your ultimate financial goals,” he said. “For example, if your employer matches your 401k contributions, make sure you are saving as much as your maximum 401k contribution limits will allow; otherwise, you are missing out on free money from your employer and the money that will be made on the investment.”

Use the power of dollar cost averaging to your advantage

Long-term investors, who are at least a decade or more away from retirement, can actually benefit from a downturn in the stock market thanks to dollar cost averaging.

Rather than investing a chunk of money all at one time in the stock market, the key is to regularly invest the same amount of money every month –- automatically if possible, such as through your employer-sponsored 401k retirement plan.

When the market goes down, that money will buy more shares in the stocks that have lost value. And when the market eventually rises again, the stock values -– and your total investment -– will grow. So rather than agonizing over those red numbers, just tell yourself, “Now I’m able to buy more shares!”

If you are a casual investor primarily investing for your retirement, you really don’t need to over-think this process – just make sure your money is automatically deducted in a balanced portfolio that makes sense for your expected retirement age. Then let your investments do the work for you.

Learn more by trying Suze Orman’s Dollar-Cost Average Calculator.

Every little bit counts

A thinner wallet doesn’t mean you should necessarily ease up on savings. If paying for the necessities in life becomes a challenge, you might need to scale back temporarily, but never give up on savings altogether.

For example, you might need to prioritize your rainy day savings account over “luxury” savings goals (a vacation or a new house). Having even a small amount saved up will give you peace of mind and can help in case of an emergency, which can pop up at any time.

“If you stop saving and lose sight of your goals, you’ll lose momentum and it’ll be difficult to get started again once the times improve,” said Schrage. “Your perseverance will pay off in the end because not only will you have saved money, you’ll have experienced character-building by resisting the easier path.”

Saving money actually helps the economy

In an economic downturn, some people argue that spending money — rather than saving it — is the key to stimulating the economy. In other words, you can look at that shopping spree at Macy’s as doing your patriotic duty to keep the financial engines humming.

But in fact, saving your money at a bank also keeps the economy on track, as that money stays in the marketplace and is lent out to people and businesses and reinvested in your community many times over.

But no matter how bad things seem, there’s one thing you should never, ever do: hoard money under your mattress. That’s one place where your dollars aren’t helping anyone or anything, including a good night’s rest.

Cynthia J. Drake is a personal finance writer who lives in Michigan. Cynthia J. blogs via Contently.com.

You follow all the financial rules: a six-month emergency fund and no credit card debt. You live within your means and have all the right insurance.

Yet sometimes, disaster strikes, and you’re wiped out monetarily anyway. A recent State Farm survey found that although 81 percent of adults believe it’s very important to have a financial Plan B, only 45 percent have such a plan in place.

“You have to have a Plan B,” says Richard Reyes, a Maitland, Florida–based financial planner. “There are some extreme things you can’t control. But you can take steps to have a backup plan and be flexible.”

José Perez knows this too well. He and his wife Olinda earned $120,000 per year, had retirement savings, health and life insurance and $30,000 in an emergency fund. “My wife was amazing with money—could make $500 and save $600,” José says. But shortly after José left his union construction job in 2008 for a position with higher pay, Olinda was diagnosed with breast cancer. Then the Bayonne, New Jersey, couple found out that José’s new employer had let their health insurance premiums lapse. “My boss didn’t tell me,” José says. “Otherwise I could have gotten COBRA.”

Instead, the couple spent their savings and cashed out retirement plans and a $100,000 life insurance policy for its $30,000 cash value. Olinda stopped working as a substitute teacher and José had to take unpaid leave to attend to her care. All told, before Olinda passed away in December 2010, the family went through $150,000 in savings to pay for medical treatment and living expenses. Today, José is contending with $40,000 credit card debt while raising two kids, now 9 and 13. “The majority of this is just bad circumstances,” José says. “Though some of this could have been avoided by me.” In hindsight, he says, it would have made more sense not to cash out that life insurance policy and instead found other ways to come up with the $30,000. “But when you’re going through a health hardship, you don’t want to break someone’s life down into financials. You just want to do the right thing.”

Assemble a team of experts

Steve Elliot, an accountant in Bellmore, New York, says situations like the Perez’s illustrate that the most important step you can take is to gather a team of experts now, so you can call on them during times of crisis. These individuals might include an accountant, lawyer, financial planner, insurance agent or health insurance advocate. “Having a team to call on in times of crisis helps relieve the panic,” Elliot says. It also helps prevent making rash financial decisions, he adds.

As a basic rule of thumb, your Plan B should include strategies for insurance, savings and investments. But it can also include things such as career planning (in the case of layoffs or business failure) and living arrangements in the event of a crisis. State Farm reports that 22 percent of those surveyed say that they would move in with family if disaster strikes. The survey did not ask whether their families would have agreed.

To get this plan solidified, State Farm spokesman Bob Lapinski urges these steps:

1. 1. Tell a spouse/partner/child/trusted friend about your plan.
2. 2. Hire a professional you feel comfortable with to help you put your plan into action. This might include a financial planner, accountant, lawyer or insurance agent.
3. 3. Get it in writing.

Even those who are adequately insured sometimes find themselves scrambling for policy information in an emergency, Reyes says. As such, make sure you are familiar with the terms of your coverage, and keep all important documents in an easy-to-find location—and tell loved ones where they can find them.

Stay informed

In cases of unemployment, it is important to avoid tapping into your cash savings for as long as possible, Reyes says. “If you have the cushion of a spouse working or a severance package, you can buy yourself a little time,” he says. “But you can’t be lazy and take a sabbatical.” Instead, find something short-term or part-time while you look for a full-time position in your field. Also, keep an open mind about your job title, industry and location. “There is nothing in the law that says that just because you’re doing XYZ, you’re going to do that for the rest of your life. Economies and industries change.”

Divorce can sometimes strike one party by surprise and turn their financial life upside down. Reyes suggests that both partners should always be familiar with all the family’s financial matters and keep their professional skills current, regardless of whether they choose to work. “You need to prepare for the worst so you’re not blindsided,” Reyes says.

This post was provided by RetailMeNot.com, originally published as What’s Your Plan B? by Emma Johnson

If there’s one thing you can be certain of in life, it’s the uncertainties. No matter how carefully you plot out your expenses, there will always be those that you didn’t account for. You’ve got medical insurance so you think you’re okay. But what happens when you need an expensive prescription only to discover that it isn’t covered. You’ve got homeowners or renter’s insurance and you’ve insured your wedding ring. But what happens when an unexpected bundle of joy is delivered, or you decide to send your little darling to an expensive private preschool?

It’s not enough to make sure you’ve paid down your credit card debt or to make sure you are investing for your eventual retirement. An emergency fund must be a part of any sound financial plan.

Most people count on their employer for their income, tax payments, and medical benefits. But what happens when you are laid off (an increasing likelihood in this economy) and all of a sudden you are stuck with having to pay for things yourself. No matter where you stand financially, it’s going to take you awhile to get back on your feet. So most people will agree that an emergency fund makes fiscal sense. The question is how much do you need?

The standard answer to that question is that you should have three to six months of expenses set aside but in these oh so nonstandard times, that’s not necessarily enough. Keep in mind that every individual is different and your expenses will vary depending on what time of year it is. You might have a particularly expensive hobby, like going up to Lake Tahoe every weekend to ski during snow season. Or you might need to pay a piano teacher for lessons each week. If you’re thinking that these are luxuries that can be cut back on when disaster strikes, you’re right. But ideally your emergency fund should allow you to maintain the same quality of life you have now. With an unemployment rate that is at the highest it has been for the past 15 years, you may need to revise that time frame to between 6-12 months. If you are more experienced and thus higher paid, you will be at a disadvantage during this recession because it will take longer, often much longer, for you to find a job.

Your first step in establishing an emergency fund should be to set up a budget. It’s especially important to pay attention to those reoccurring payments; grocery bills, car payments, rent or mortgage payment, internet access and phone bills, electric and water bills, that can’t be entirely eliminated.

Okay, now that you’ve established the need for an emergency fund and have some idea of how much you need, you need to decide where that money should go. No, stuffing it under your mattress is not a viable option. You still need to put your money to work for you so that you can, at minimum, get ahead of inflation. Remember that you’ll need immediate access to these funds should disaster strike so forget about any accounts or investment vehicles that make you pay a penalty for early withdrawal. That’s what the financial gurus refer to as liquidity.

This is your emergency fund we are talking about so you should be as risk adverse as possible when it comes to establishing it. So forget about the stock market and put that money into an interest earning account at the highest yield possible. Mint.com’s Ways to Save can help you identify whether the interest rates and fees you are paying on your current checking and savings accounts are as good as you can get. If not, consider opening an account just for your emergency fund. In addition to checking and savings accounts, you may want to consider money market mutual funds or a certificate of deposit (CD) as places to stash your cash. Both are good, stable investment vehicles that are somewhat immune to the ups and downs of the financial markets.

Lastly, you should make sure that your credit score is high and you’ve established a solid line of credit. Worse comes to worse, you can pay for your day-to-day expenses with your credit card and defer the payments until such time as you are again gainfully employed or otherwise financially solvent. But this should remain a last resort. Make sure you pay the balance off in full each month so as not to incur finance charges. With a little advance preparation, you can weather any storm.

You would if you had what we’ve dubbed a “Grab-and-Go Box,” a financial emergency kit containing the essential items you need to keep your family finances running smoothly in the midst of chaos. Not only will having this box bring peace of mind, but it can also prevent a personal crisis from turning into a financial disaster. Here’s how to put one together.

Construct your “Command Central”

Your Grab-and-Go Box should be small enough that you can run a mile with it tucked under your arm … or at least walk briskly around the block without it being overly cumbersome.

Your mobile emergency kit will contain copies (not the originals!) of some vital personal and financial information. Store it in a safe place, and tell everyone in the household plus a trusted neighbor or friend where it is. Let’s go over the vital data you’ll need — the bare-bones information to get started. Add any items to this list that are essential to keeping your family finances on track.

The Motley Fool Grab-and-Go checklist:

Contacts: Note the phone numbers, addresses, and email addresses for family, friends, schools, medical and financial advisors, utilities, and service providers — even the cleaners and gardeners. Designate an out-of-town contact for everyone to call.

ID: Assemble passports, a current picture of each family member, and birth and marriage certificates.

Emergency resources: Include some cash and prepaid phone and charge cards.

Medical: Pull together health insurance policy information; claim forms; copies of insurance cards; a list of hospitals, doctors, pharmacies, and current prescriptions; and medical histories.

Financial: Gather the information for your credit cards, bank, brokerage, mortgage, and savings account. Jot down all of the account numbers, the branch locations, the websites, the phone numbers, and the passwords (kept secure). Include the location, spare key, and content list for your safe-deposit box, and make sure a loved one or trusted advisor has been granted access.

Household: Document all payment obligations (mortgage, credit cards, utilities, and auto, student, and any other loans), as well as the due dates, minimum required payments, and other payment info. Online banking and bill payment is a real help in these situations.

Insurance/recovery information: Include homeowners’, auto, life, and disability policies and cards; blank claim forms and contact information; and a list of local adjusters.

Legal: Make sure you’ve included your living will, health-care proxy or medical directive, will, durable power of attorney, and the deed to the house.

Extra credit

Make an inventory of your stuff: Just 42% of us have an inventory of our home’s contents, according to the Insurance Research Council. Itemizing your assets gives you a running head start if disaster strikes. The Insurance Information Institute’s free home inventory software at knowyourstuff.org makes it easy by going room to room and allowing you to attach photographs and scanned receipts. (Don’t forget the stuff in the garage, basement, and attic.)

Compose a family crisis “to do” list: Before disaster strikes, get your ducks in a row with the help of two free downloads from retired estate and financial planner and disaster-preparedness guru Martin Kuritz. Head to active-insights.com/free-downloads.asp, and look for the “Disaster Preparedness Guide and Checklists” and “First Things,” which includes what you should do right away after a family crisis.

Learning to create a personal budget is something that we care about here at Mint. Learn more with great budgeting tips in our blog article index.

In almost every piece of general personal finance advice, you’ll skate across a recommendation for an emergency fund. Whether it’s for the “oh no, I broke my leg” moment; or the “oh no, my engine just blew up” drive; or the “I just got fired” shock; it’s critical to have that rainy day money stored away for just such an occasion. Even if you create a personal budget, you still need to have an emergency fund.

There are a few components to just such an emergency fund, which we’re about to go over. You should be able to access the fund easily, for example: it shouldn’t take over a week to access. You should use the fund only for an emergency; and we don’t mean for emergency Vegas bets, either. Although it’s a relatively simple concept, an emergency fund is a cornerstone component for every financially responsible young professional.

Just How Much Should I Hoard Away?

The amount of money you should have in your emergency fund varies. Experts often recommend to keep it at a minimum savings of three to six months worth of basic living expenses. On the other hand, many experts also believe that a fund of that size may be hard to accumulate, so they also suggest smaller fixed amounts between the ranges of $1,000 to $3,000.

In the end, how much you really need depends on how you create a personal budget. The life and expenses of a young professional varies significantly, after all. Some of us may already have a family, while many of us are content being a single. Some of us may have a mortgage, while others enjoy living in an apartment.

The factors to consider include:

• The more people you need to support (besides yourself), the more unexpected expenses may occur — thus, the larger your emergency fund should be.
• How easy is it for you to find a new job if you suddenly lose your old one? Compare the demand for a professional Technology Blogger (heh) to that of a nurse. If you’re a nurse and suddenly get laid off, you may have little trouble finding a new job within a reasonable time frame.
• As it is with finding a new job, you should also consider your current job security. How stable is your industry? Is your company on the verge of bankruptcy?

To make things easier, besides the factors mentioned above, try a brainstorming session of what may count as emergency to you. List how much each situation may potentially cost. After you’ve given some thought to these scenarios, you should have a better understanding of how much you may need in case of that rainy day.

Steps to Building an Emergency Fund

1. Set an amount that you’re comfortable with. If you know for sure you can’t accumulate three to six month worth of basic living expenses (that is, food, lodging, transportation, etc.), try the smaller ranges of $1,000 to $3,000.
2. Start saving right away. Any amount will do. After you’ve met your basic living expenses, you should put away any extra money towards an emergency fund.
3. Having difficulty finding spare change to save for an emergency fund? Try cutting down on your expenses temporarily. Skipping that weekend where you treat your buddies out, or withholding yourself from premium cable for a few months, can quickly add up to sizable amounts. You can always tack these expenses back on after you’ve built your emergency fund. Who knows? You may also find out that you’re perfectly okay without these luxuries. This is where creating a personal budget will really help you.
4. Paid off a recent bill, like an auto loan or credit card statement? Keep paying the same amount — this time, to yourself.
5. Got a nice fat tax return? No, it’s not vacation time. If you don’t have an emergency fund, this is a great boost toward building one.
6. Keep your funds in a liquid account, so it’s easy to convert into cash. A checking account, saving accounts, money market accounts, and even a Certificate of Deposits can work (although there may be penalties to early withdrawals from the latter). For those comfortable with Internet banking, try the many high-yield online savings accounts such as ING Direct or HSBC Direct. Wherever you choose, avoid an account with fees that may actually diminish your emergency fund in the long term.
7. Don’t keep for fund where you can spend it easily. This is not an issue if you’re disciplined, but for some, keeping it liquid also means that it can be spent more easily. If you’re unsure of your discipline in leaving the emergency fund alone, open a checking/savings at a separate bank. This gives yourself some barriers to think twice before you cash the fund.
8. Once you’ve met your emergency fund goal, move on to other financial goals. Now you can worry about other goodies such as saving and investing for retirement, and saving for your children’s’ education.
9. Reexamine your emergency fund’s size periodically — especially during life-changing events. Finally got hitched? Suddenly have a kid? Landed a hot new job? Reexamine your fund’s size to see how well it correlates to your current situation in life. Perhaps it may be time to put a little bit more in.

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Break (Only) in Case of Emergency

Remember that an emergency fund is only for an emergency, and not to be taken lightly. These chunks of cash are a necessary part of any sound budget. Go without one, and you’ll risk falling into unmanageable debt all the more readily. The bottom line is, don’t let yourself pay those sudden bills or loans on plastic alone! You should always have a bit stashed away to back yourself up.

This post was written by Cap of StopBuyingCrap.com.

Further Reading on Emergency Funds

• Create a Budget Online
• Household Budget Software
• Online Financial Calculator