While I can't tell you the exact problem you'll face, I can pretty much guarantee that one day an unforeseen life twist will leave you in a financial knot. It might be a car accident that puts you out of work, an insurance claim that doesn't cover the cost of replacing your property, or an ill friend or relative far away whom you'd like to be able to visit. In a crisis, it's important to know you have resources.

The Rainy-Day Fund
Ideally, you will have eight months of living expenses stashed in a savings account. I know that sounds daunting, but make it a goal. Start putting away a little each month. Every penny you save is a step toward building your own personal insurance plan.

Your Roth IRA
One of the reasons I think Roths are so great is that your contribution can be withdrawn at any time or age with no penalty or tax bill. You just can't touch the earnings before you're 59 without incurring the 10 percent penalty and income tax.

A 60-Day Loan from Your Traditional IRA
In a short-term jam, you can withdraw funds from your IRA for up to 60 days without penalty. The catch is that you must replenish the account during that period. If you don't, you'll be hit with income tax on the money you took out as well as the 10 percent penalty if you're not 59 or older.

A Low-Rate Credit Card
With a solid credit score, you should be able to get a card with a very low interest rate (around seven percent). Tuck it away, and use it for a cash advance only in a dire situation.

A Home Equity Line
Take this out before you need it, but vow not to touch it unless absolutely necessary. The idea is to have the account in place as a last resort. You aren't charged interest until you start using the money. But remember: Your home is the collateral, so don't go this route unless you have no other options.


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