Americans should adjust financial plans, preparatio​ns

The commonly-cited accounting tip that households should try to amass an emergency fund that amounts to three-to-six months' worth of living expenses may be obsolete, experts say.While many financial planners and professionals have referred to this rule of thumb in the past, some think it may no longer be enough, according to the Wall Street Journal. This is partly because many people, when saving in their rainy-day funds, fail to take into account higher prices for necessities like gas and food. Another common issue is that households may forget to update their plans after life-changing events such as marriage, buying a home or having a child. Such major changes of circumstance require financial adjustments as well, experts say, but people often forget to make them. For example, it is generally wise to update estate tax planning after such events.As far as planning an emergency fund goes, Americans may want to meet a goal of setting aside nine months' or even a year's worth of living expenses. The change is partly because unemployment is lasting longer, an average of 40 weeks. Additionally, homeowners may no longer be able to turn to a home-equity line of credit in emergencies, the news source notes, with tighter lending standards.People may also fail to take inflation into account when contributing to their own emergency funds, which could lead them to overestimate how far those savings will go in an emergency.