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How much do you need for an emergency fund?

Unemployed_men_queued_outside_a_depression_soup_kitchen_opened_in_Chicago_by_Al_Capone_02-1931_-_NARA_-_541927With 800,000 federal employees being furloughed or working without pay, many stories have been reported about people having difficulty paying their bills including mortgages, rent, car payments, and student loans.

How much money should consumers have for an emergency fund? The standard recommendation is three to six months of expenses.

To make your calculation, estimate the costs of housing, food, health care including insurance, utilities, transportation, personal expenses, and debt. Things you can cut from your budget – such as entertaining, eating out, shopping, vacations, and savings – don’t need to be included.

You may want to include more than three to six months of expenses if your income isn’t steady if layoffs are common in the type of job you have, or during a recession.

If your budget is tight, start by saving small amounts of money each week, $25 for example.

Put your money in a place where you can get at it easily and quickly. Money market funds work well because they’re easy to access and you make a little interest.

Only 29 percent of adults say they have that six months’ worth of emergency expenses, according to a Bankrate survey.


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Tom @ Sightings

Your post got me thinking. How long would I last if the Social Security deposits stopped coming?
Perhaps it's a question we should all ask in these uncertain times. For me the answer is: a while, but not forever.


Good Post.
Good point Tom. Since our pensions/SS are all federally funded, we have saved as much as possible. Still, we are enjoying retirement as well.
I tell the kids all of the time, if we go down a whole lot of the country will be further down then us!
Still, we are acutely aware of the furloughs. My daughter is coordinating diaper and formula delivery in her, high federal government employment, area.


Yes, it's important to have an emergency fund. It's good that Social Security payments are being made during the partial government shut down. If they were stopped, it would be detrimental for many seniors.



I feel so horrible for all those people who aren't getting paid. I hope it ends soon because it's so unfair and is compromising everyone's security. I opened an online bank account so I could siphon small amounts into it. I have to be more consistent in doing it.


Hi Rebecca,

I agree the government shutdown is terrible. Government workers deserve to be paid -- now.

Good for you for putting small amounts into a bank account. It will add up to provide an emergency fund for you.


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