Poll: How Big Is Your Emergency Fund?

Below is a chart of the median duration of unemployment from July 1967 to December 2010, based on data supplied by the US Department of Labor. Things are bad out there, and remember, this is just the median!

According to this December 2010 report from the Bureau of Labor Statistics, out of the 9.4% unemployment rate, 44.3% of them are considered long-term unemployed (those jobless for 27 weeks or more). That means over 4% of the total US workforce – 6.4 million people – has been unemployed for over 6 months.

Which leads to the poll question of the week. How prepared are you for an extended period without a paycheck? In this case, by emergency fund I am talking about a cash (or similar) cushion that is accessible, not lines of credit.

How Big Is Your Emergency Fund?

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What Is Your Portfolio’s Current Asset Allocation?

If you haven’t been keeping close track of it, your portfolio’s asset allocation may have shifted significantly over the past year. Your relative mix of assets like stocks, bonds, or real estate has a great impact on the volatility and expected future return of your portfolio.

Morningstar has a bunch of helpful tools for managing your investment portfolio, but many of them require a paid membership. However, one handy trick is that anyone can use many of these premium features for free at the T. Rowe Price website by signing up for a free account with nothing but an e-mail address.

Portfolio Manager
This tool lets you enter all your portfolio holdings, which it then stores for you and allows you to track it with automatically updated prices. You can either track all your future transactions as you go, or just input your updated holdings every few months like I do.

Portfolio X-Ray
Once you enter your holdings, simply look for the Portfolio X-Ray tab and you’ll have a complete breakdown of the true asset allocation of your overall portfolio. Does your “small cap” fund really own a bunch of mid-caps and large-cap funds? X-Ray will reveal your true exposure to stock style (i.e. Small/Mid/Large, Growth/Blend/Value), geographical regions (i.e. Japan, US) , stock sectors (i.e. Telecom, Energy), average expense ratio, and more.

If you’d rather have a quick peek without needing to register at all – but also without the ability to save your portfolio – try the Morningstar Instant X-Ray tool.

If you already have a target asset allocation in mind, now might be a good time to to rebalance your assets back towards that target. Rebalancing is a way to maintain the risk/reward balance that you have chosen for your investments, and also forces you to buy temporarily under-performing assets and sell over-performing assets (buy low, sell high). If you are looking for a bit more guidance, here are my favorite posts on investing.

Free Credit Score Estimates From Transunion, Equifax, and Experian

It’s 2011, so why not a status check on your credit scores? In a previous post, I explained the relationships between credit reports vs. FICO credit scores vs. FAKO credit scores. Give it read if you haven’t already. You can obtain a free copy of your credit report from all three major credit bureaus once every 12 months from AnnualCreditReport.com, as mandated by the government.

As for credit scores, chances are you’ll have to pay up for a FICO Score. But even though I feel that such FAKO scores are only good as a credit score estimate, I’ll still take it if it’s free. Remember, there are three different credit reports out there for you, so there are also three FAKO credit scores you should track. It happens that there are websites that will either provide a free FAKO or a credit score range for all three credit bureaus with no credit card required. Pulling your own credit score doesn’t hurt your score either.

TransUnion-Based

CreditKarma.com is an ad-supported site that offers you a free FAKO as often as you like, called a Transrisk score, based on your Transunion credit report. The score range is the same as FICO, from 300-850. Brave souls!

You don’t get your credit report details, but you do get a few tips on what recent changes to your credit report have impacted your score. CreditKarma recently added two new free scores as well – the VantageScore and Auto Insurance Risk Score, both based on your TransUnion data. VantageScore is basically a challenge to FICO and has a completely different scoring range system, and the other one is used by auto insurers to “assess your riskiness and to assist in pricing your premiums”.

Equifax-Based

The Equifax Credit Score Card comes directly from Equifax and provides a free credit score range of Low (280-559), Below Average (560-659), Average (660-724), Above Average (725-759), and High (760-850). It’s called the Equifax Risk Score. FICO has a range of 300-850, and this range is 280-850 so you don’t really have to do any scaling.

It doesn’t provide any specific data from your Equifax credit report, but it does include a short summary of any negative factors that you may have on your report.

Experian-Based

Quizzle.com is a site owned by Quicken Loans that offers you a free FAKO score every six months, called a “CE Credit Score”, based on your Experian credit report. FICO has a range of 300-850, and this range is 350-850 so you don’t really have to do any scaling. They just seem to alter it just enough so FICO doesn’t sue them.

The site also provides access to the details of your Experian credit report, so this can be handy if you’ve already used up your freebie from government-mandated AnnualCreditReport.com.

One annoying part of the site is that they ask “required” questions about your home and mortgage that seem to imply that the answers are needed to access your credit score, but in fact are not. They just want the data to better target you for things like home equity loans or refinances (remember who runs the site).

FICO Score Estimator

Just for good measure, I filled out the FICO Score Estimator and got the following result:

If you really want your official FICO score, you can still get it with a free trial and immediately cancel with minimal hassle. Here are step-by-step instructions. The FICO is based on your Equifax report.

Note: Unless you’re going directly with a credit bureau (which already has your sensitive data), you’re going to have to give your personal information including Social Security Number to a third-party website. I am not a online security expert, so you’ll have to do your own due diligence as to whether you want to proceed. I have agreed to be the test monkey and have used all these sites, and am showing you real screenshots of my results above.