How much should you keep in an emergency fund?
An emergency fund helps you pay for unexpected expenses without relying on a credit card or loan. A common long-term goal is to save three to six months of essential expenses. If that feels overwhelming, start smaller. Even your first $100 or $500 can make a difference.
What is an emergency fund?
An emergency fund is money set aside for costs you did not plan for, such as:
• A car or home repair
• A medical bill
• A sudden loss of income
• An emergency trip
• A broken appliance that must be replaced
This money is different from savings for a vacation or holiday shopping. It is there to help protect you when life does not go as planned.
How much should you save?
There is no perfect amount for every household. Build your emergency fund in steps:
1. Start with $500. This can help cover a smaller emergency.
2. Save one month of essential expenses. Add up necessities like housing, food, utilities, insurance, transportation, and minimum debt payments.
3. Work toward three to six months of expenses. This larger goal can help if your income stops or a major expense comes up.
You may want to save closer to six months if your income changes, your household depends on one paycheck, or you have children or other dependents.
Start small and save regularly
You do not need to build your emergency fund all at once. Choose an amount that works with your budget and save it regularly.
You could:
Set up an automatic transfer on payday.
Save part of a tax refund or bonus.
Move $10 or $20 into savings each week.
Add extra money when you spend less than planned.
Increase your savings amount when your budget allows.
Small deposits add up. Saving $25 every two weeks adds up to $650 in one year.
Find a Sea Air savings account that works for you
Keeping emergency money in a separate savings account can make it easier to track your progress and avoid spending it on everyday purchases.
Sea Air FCU offers several savings options, including the Save to Win® Emergency Savings Account. It is designed to help you build a financial safety net while giving you opportunities to earn entries into cash prize drawings as your balance grows.
Build your money skills with Zogo
Not sure where to begin? Sea Air FCU members can use Zogo to learn more about saving, budgeting, credit, and other money topics.
Zogo turns financial education into a game with short, interactive lessons that reward you for learning. Download the app and enter code SAFCU when you sign up.
Take your first step today
Your emergency fund does not need to be perfect. It only needs a starting point.
Choose your first goal, make your first deposit, and keep building. Explore Sea Air FCU savings accounts or use Zogo to build your financial knowledge one short lesson at a time.