How much emergency fund should I have?

Generally, you should aim to have 3 to 6 months of essential living expenses saved in an emergency fund. For a typical household with monthly essential expenses of $3,000 to $5,000, this translates to an emergency fund of $9,000 to $30,000.

Your ideal amount depends on your job stability, dependents, and income structure:

• 3 Months ($9,000–$15,000): Best for dual-income households with highly stable salaried jobs, low debt, and no dependents.
• 6 Months ($18,000–$30,000): Best for single-income households, families with kids, homeowners, or those with moderate debt.
• 9 to 12 Months ($27,000–$60,000+): Best for freelancers, contract workers, commission-based sales roles, business owners, or anyone with highly unpredictable income.

To calculate your personal target, list only your essential monthly expenses (housing, utilities, groceries, insurance, minimum debt payments, and basic transportation). Exclude discretionary spending like dining out, gym memberships, and streaming services, as you would cut these immediately if you lost your income.