$3,500 expenses, 6-month base, stable income, single-income, 1 dependent
- Risk multiplier = 1.5
- Recommended months ≈ 9
- Fund ≈ $31,500
finance calculator
Emergency Fund Calculator
Estimate how much cash you should keep for emergencies based on monthly expenses and risk factors like variable income, single-income household, and dependents.
Results
- Recommended emergency fund
- $31,500
- Recommended months of expenses
- 9.00
- Risk adjustment factor
- 1.50
How to use this calculator
- Enter your essential monthly expenses.
- Set a base months target (commonly 3–6 months).
- Select whether income is variable, whether the household relies on a single income, and add dependents.
- Review the recommended months and total dollar target for your emergency fund.
Inputs explained
- Monthly expenses
- Essentials only: housing, food, utilities, insurance, transportation, debts.
- Base months
- Starting point (e.g., 3–6 months); we adjust up for risk factors.
- Variable income
- If your income fluctuates, a larger cushion helps cover dry months.
- Single income
- One income source means higher risk—adds cushion.
- Dependents
- More people relying on income increases recommended buffer.
How it works
Base target = monthly expenses × base months.
Risk adjustment adds 0.5× for variable income, 0.25× for single-income households, and 0.25× if you have dependents.
Recommended months = base months × risk multiplier; fund = monthly expenses × recommended months.
Formula
Recommended months = Base months × (1 + 0.5 if variable income + 0.25 if single income + 0.25 if dependents ≥1) Fund target = Monthly expenses × Recommended months
When to use it
- Setting a cash reserve goal before investing extra funds.
- Adjusting your fund size after a job change, new dependent, or moving to variable income.
- Planning to rebuild an emergency fund after using it.
Tips & cautions
- Keep the fund liquid (high-yield savings) for quick access.
- Revisit the amount annually or after major life changes.
- If income is highly variable, err on the higher end (9–12 months).
- Simple multiplier-based estimate; not a personalized financial plan.
- Does not account for insurance coverage specifics or disability protections.
- Assumes expenses are accurate; update expenses periodically.
Worked examples
$4,800 expenses, 6-month base, variable income, single-income, 2 dependents
- Risk multiplier = 2.0
- Recommended months ≈ 12
- Fund ≈ $57,600
Deep dive
This emergency fund calculator recommends how many months of expenses to save by adjusting for income stability and dependents.
Use it to set a realistic cash reserve target before investing or taking on major expenses.
FAQs
- Where should I keep the fund?
- A liquid, low-risk account like a high-yield savings. Avoid tying it up in investments.
- Is 3–6 months enough?
- Many use 3–6 months; more if income is variable, you’re single-income, or have dependents.
- Should I include non-essentials?
- Focus on essentials. Discretionary spending can be cut in emergencies.
- Can I invest part of it?
- For true emergencies, keep it liquid. Invest only amounts beyond your cash cushion.
- How often to update?
- Review yearly or after major changes (job, move, dependents, income stability).
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Guidance only, not financial advice. Consider your personal risk tolerance, insurance coverage, and job stability when setting an emergency fund target.