How much to save for an emergency is one of the hardest questions to answer in personal finance.
The truth is that there’s no one answer. Countless factors will impact not only how you think about your emergency fund, but how much you’re able to save. That includes your typical expenses, of course, as well as where you live, your family size, your standard of living, your risk tolerance, your goals, and even your experiences with money growing up.
Some people feel comfortable having just a few months’ worth of expenses set aside while others wouldn’t want to have at least enough to cover a full year. While most financial experts consider three to six months’ worth of expenses a good goal to aim for, some are starting to rethink that.
Below, eight women from around the country disclose how much they (and their partners/spouses, if applicable) have saved and invested.
Home Economics No. 51: Single, 29, and earning more than $500k as a data scientist in NYC
Location: New York, NY
Age: 29
Household size: 1
Annual income: $500,000
Total cash savings: $10,386 (3.25% APY)
Total retirement investments: $310,850
Total taxable investments: $890,752
Treasury bill ladder: $34,027
Total in savings and investment accounts: $1,246,014
I’m very proud of the strong financial foundation I’ve been able to build for myself since graduating college. My priority these past years has been to build a nest egg so that my options remain open as I head into my 30s. I could feasibly take a sabbatical, move to a less demanding job, or be work-optional by my late 30s. In the past year, I’ve purposely been letting my lifestyle expenses increase. My overarching financial goal is allow myself to live more comfortably while aiming for work-optionality by the end of my 30s.
Home Economics No. 50: Divorced, 47, and raising a kid in Vermont on $85,000 a year
Location: Montpelier, Vermont
Age: 47
Household size: 2 (mother and child)
Annual income: $85,000
Total cash savings: $7,000 (3.3%)
Total retirement investments: $171,500
Total 529 investments: $500
Son’s savings account balance: $250
Total in savings and investment accounts: $179,250
I’ve been single for about five years now. Divorce has been a game changer for me. I would recommend it! My marriage afforded me a certain amount of privilege, as my husband made a good salary, and our combined income was close to $200,000. But even though I have less money coming in now, and I receive some child support, I feel more independent and confident about my financial position than when I was married. I’m the only one in charge of my money now, and I like it that way.
Home Economics No. 49: Married, 38, and supporting family through a hard time in Las Vegas
Location: Las Vegas, Nevada
Age: 38
Household size: 2 (spouses)
Annual income: ~$121,000
Total cash savings: $10,687 (3.65% APY)
Total retirement investments: $156,978
Total in savings and investment accounts: $167,665
I want to have a bigger emergency fund. We had to dip into ours a couple times this year and haven’t built it back up. I am trying to tighten up our spending on some things (groceries, dining out, trinkets) to contribute more to savings for the new year.
Home Economics No. 43: A family of 4 living in Pennsylvania on $96,000 a year
Location: Harrisburg, Pennsylvania
Age: 30
Household size: 4 (2 adults, 2 children)
Household income: $96,000
Total emergency fund savings: $6,000
Total retirement investments: $68,000
Children’s savings account balance: $500
“Fun” money account balance: $2,190
Total in savings and investment accounts: $76,690
We are currently using a significant portion of our savings to help a coworker who is a single mom and was recently evicted. We have been paying her motel bills, getting her groceries, and trying to help her get back on her feet and find an affordable apartment. Obviously, it is a privilege to be able to help someone out, as so many have helped us out, but we are feeling the pinch. (Comparatively! We have a home, after all!) It would be amazing to someday have the cushion to be able to help out without having to worry about our own emergency funds.
Home Economics No. 42: Single mom living in Boise, Idaho, on $120k a year
Location: Boise, Idaho
Age: 34
Household size: 2 (mother and child)
Household income: $120,000 + bonus
Total emergency fund savings: $131,900 (2.96% APY)
Total retirement investments: $285,652
Total taxable investments: $17,758
Total 529 investments: $6,000
Total in savings and investment accounts: $441,310
I used to get stressed out about spending money from my savings account. A couple of years ago I decided to open a sinking fund account and deposited ~$10,000 in there as a way to encourage myself to feel better about spending my money on things like travel. This fund really helped me change my mindset, and it has stuck with me. Now, since I am earning more interest from my HYSA, I have diverted my fun money there but have kept the mindset developed from my sinking fund, which allows me to be more relaxed and enjoy the bigger purchases. I would love to have a bank account that allows me to bucket out my savings account into different goals, but I am too loyal to my bank that doesn’t currently offer that feature. Next year, I will try to do this in a manual tracker.
Home Economics No. 40: Furloughed federal employee in Tucson, Arizona
Location: Tucson, Arizona
Age: 41
Household size: 4 (2 adults, 2 children)
Household income: ~$185,000
Total emergency fund savings: $18,000 (3.5% APY)
Total retirement investments: $1,249,000
Total taxable investments: $335,000
Total iBonds: $20,000
Total 529 investments: $66,000 for both
Total in savings and investment accounts: $1,688,000
I recently received about $300,000 when my father passed away unexpectedly earlier this year. It’s been unduly stressful trying to deal with all the logistics required to actually get that money on top of actually grieving. Either way, I am very thankful. It’s allowed me to put a lot more in the kids’ 529s.
Home Economics No. 36: Single, 46, and living in Brooklyn on $179,500
Location: Brooklyn, New York
Age: 46
Household size: 1
Household income: $179,500 + 15% bonus
Total emergency fund savings: $191,562 (3.5% APY)
Total retirement investments: $254,582
Total taxable investments: $36,421
Total in savings and investment accounts: $482,565
My dad died a couple of years ago, and I inherited some money from him ($150,000 of my HYSA balance, plus the inherited IRA). I probably should invest that money, but I am thinking about buying a coop or condo here in the next few years, so it’s staying put and earning interest for now. My mom is aging, but she’s doing pretty well. We have open discussions about her assets, as I am one of the executors of the estate, along with my brother. She has paid off the mortgage on her house, and she has a fair number of investments. It’s likely my brother and I will each receive around $500,000 when she passes, which I hope does not happen for a very long time.
Home Economics No. 33: Stay-at-home mom and software engineer living on $190K in Utah
Location: Utah County, Utah
Age: 30
Household size: 6 (2 adults, 4 children)
Household income: ~$190,000
Total emergency fund savings: $12,838 (3.5% APR)
Total retirement investments:$137,055
Total taxable investments: $60,800
Total in savings and investment accounts: $210,693
Generally, our philosophy is to keep at least $30,000 liquid savings in the high yield account and $20,000 that’s easy to pull from our brokerage account. During the jobless period, things shifted around (higher checking balance, lower savings balances), but really these accounts are so interconnected and at the same institution that the shift was symbolic more than anything. Our “big savings” happens in the taxable brokerage.
