Personal Finance

Emergency Fund

Cash set aside for surprises, usually 3 to 6 months of essential expenses.

An emergency fund is the cushion that turns a job loss or a car repair from a crisis into an inconvenience. Keep it somewhere safe and instantly available (a high-yield savings account), not invested in stocks. Build this before you take real investment risk. Size yours with our free calculator.

For example

If your essential monthly costs are $3,000, a 6-month emergency fund is $18,000 held in savings, not in the market.

Related terms

Budget (50/30/20)Net WorthHigh-Yield Savings Account

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