Emergency Fund Calculator
Calculate required emergency savings • Financial security • 3/6/12 month funds
Emergency Fund Calculator
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Emergency Fund FAQs
Most financial advisors recommend 3-6 months of expenses. However, if you have dependents, irregular income, or work in a volatile industry, aim for 6-12 months. Single income households should target 6-12 months for added security.
Include all essential monthly expenses: rent/mortgage, utilities, groceries, insurance premiums, loan EMIs, transportation, and minimum debt payments. Exclude discretionary spending like entertainment, dining out, and non-essential shopping.
Keep emergency funds in highly liquid, low-risk accounts: savings account, liquid mutual funds, or short-term FDs with easy withdrawal. Avoid stocks or long-term investments. The goal is quick access, not high returns.
Emergency Fund Best Practices
- Build emergency fund before aggressive investing
- Review and adjust fund size annually or when life circumstances change
- Keep fund separate from other savings to avoid temptation
- Replenish immediately after using emergency funds