The volatile stock market and slipping home values, along with unemployment, have created havoc for many American households. The positive impact of the economic downturn has been an increased focus by many people on saving money in preparation for the future.

Christensen recommends a strategy of grouping your money into three "buckets"--rainy day, preretirement, and retirement. His idea is that each of these separate buckets of money need to be funded and not mixed together.

Your ability to save at the level Christensen suggests depends in part on where your finances stand now and your age. If you are already in preretirement or retirement, you may have already funded these "buckets" and are ready to focus entirely on retirement investments.

Emergency Savings

Christensen goes way beyond most financial advisors who recommend keeping three to six months of expenses on hand for an emergency. His "rainy day bucket" recommendation is to have two years of living expenses available in money market accounts and other short-term investments in order to avoid dipping into your retirement account during an emergency.

Preretirement Savings

Christensen recommends a moderate growth investment such as a mix of stocks and bonds that can be accessed for a major expense such as college tuition or buying a second home.

Retirement Savings

Christensen suggests that, especially for younger people who are far from retirement age, retirement investments should be aggressively invested. These funds should not be touched at least until age 59 ½, when the penalties for early withdrawal disappear.

Reverse Mortgage for Income and Emergencies

While Christensen does not mention this option, a reverse mortgage could be one other financial planning tool for homeowners age 62 and older. When reviewing your savings and investments, consider the potential benefits of a reverse mortgage for monthly income or as a line of credit to increase your access to cash for an emergency. Seniors who want to stay in their homes should review the information that reverse mortgage lenders provide to see if this loan could improve their financial position.