Emergency Savings Calculator

Having adequate emergency savings can make unforeseen unemployment, auto repairs, medical emergencies, property damage and even legal issues more manageable. With adequate emergency savings, you can focus on how to best meet your family's needs, rather than worrying about finding the money to handle these difficult situations. This calculator helps you determine how much emergency savings you may need, and how you can begin saving toward this important goal.

Everything You Need to Know About Emergency Savings

Emergency Savings.

Do you have an emergency savings fund? If the answer is no, you are not alone with this answer. The majority of Americans that were asked about their financial health stated that if they had something as small as a $500 emergency, they would not have the money in an account to cover it. This can be devastating to their finances if something does happen because they'll either have to come up with the money or put it on credit cards. If they do this, interest will begin to accrue right away, and it will set them farther back in debt.

How Many Americans Have Low or No Emergency Savings?

According to a recent poll, roughly 6 out of every 10 Americans don't have enough savings to cover a $500 or $1,000 emergency. When they were asked, around 40% said that they had enough in their savings, while 19% said that they would put it on credit, 20% said they would cut their spending, and just over 10% said that they would ask friends and family. Millennials were the most prepared group, with just over 46% saying they had enough money in their savings to cover an emergency.

Emergency Saving by Generation

No Savings Less 3 Months' Expenses 3-5 Months' Expenses 6+ Months' Expenses Other
Baby Boomers - (Age 46-64) 27% 15% 11% 38% 9%
The Millenials - (Age 18-45) 25% 22% 27% 23% 3%

How Much Should You Have in Emergency Savings?

If you're not sure how much to save in your emergency fund, there a a good formula to follow. You want at least six months of expenses covered. Ideally, you would have up to a years' worth of expenses saved.

  • By Your 20s: You should aim to have at least 25% of your annual salary saved.
  • By Your 30s: You should have the same amount of your annual salary saved.
  • By Age 35: You should have twice your annual salary saved.
  • By Your 40s: You should have three times your annual salary saved.
  • By Age 45: You should have four times your annual salary saved.
  • By Your 50s: You should aim to have five times your annual salary saved.

It really comes down to your individual financial situation. However, if you don't have an emergency fund, you don't want to be caught unprepared. If it just isn't feasible for you to have those kinds of numbers invested, start smaller. You should aim for at least $5,000 or more in your emergency fund.

Why Should You Save an Emergency Fund?

With everything else that is available to save for, why should you save for an emergency fund? To a lot of people, it seems like wasted money that is just going to sit in an account when they could be using it for other things.

  • Car Repairs. Most Americas need their cars to get to and from work or school. If you live in a rural area, the chances of having public transportation are slim. Consider this, if your car needs new tires, you can find yourself paying anywhere from $400 to $600 for a new set.
  • Emergency Pet Care. If you have a pet, you know how expensive vet bills can be. What happens if your dog or cat needs emergency surgery? That can easily set you back over $2,000.
  • Funeral Costs. What happens if you have an unexpected death in the family and that person didn't have life insurance? The average funeral can cost over $9,000. Even if they had life insurance, it could take weeks or months for you to get the money, and you need money now.
  • Health and Dental Expenses. If you end of going to the emergency room or if you have an emergency dental problem, this can put a strain on any money that you may have saved. Even if you have insurance, most of them have an out-of-pocket limit you have to pay before your insurance covers anything.
  • Home Repairs. If you own your home, you're responsible for each repair or emergency that comes up. Do you have money saved to cover your roof leaking or pipes bursting? These can cost thousands, and if you don't get them fixed right away, the damage can cost more.
  • Job Loss. This is usually one of the primary reasons you want an emergency fund. You'll want to have cash on hand if the event that you lose your job and aren't receiving a paycheck.
  • Tax Bill. What happens if you get pushed into a higher tax bracket, and you get a larger tax bill than you were expecting? If you can't pay it on time, the IRS will begin to add penalties and late fees which will push you deeper into debt.

Aside from Unexpected Expenses, What Should You Cover in Your Emergency Fund?

If you haven't started an emergency fund yet and you're trying to figure out what you should include, consider your monthly expenses. You want a minimum of 6 months' expenses covered, but aim for a full year.

  • Debt Repayment. Plan to continue to make payments on your credit cards, and loans so you will protect your credit rating. If you're not working to get out of debt now, start taking steps to do this. You don't want the added stress of trying to do this if you lose your job or run into financial hardship.
  • Food. Start estimating your monthly food costs. Start cutting back on food expenses and put this money into your emergency fund. You can stop doing things like dining out, coupon, purchase sale items, and consider buying store brand products.
  • Housing Expenses. Your emergency fund should include your housing expenses like mortgage payments, rent, property taxes, utilities, and insurance.
  • Insurance. Take the monthly cost of both medical and dental insurance into account. If you have disability or life insurance, keep these costs in mind as well.
  • Personal Expenses. This one may be a little harder to estimate. You want to take household supplies, toiletries, haircuts, and clothing expenses into account for your emergency fund budgeting. They may seem inexpensive, but they will add up month after month.
  • Transportation. If you own or if you are leasing a car, keep things like fuel, minor repairs, insurance, basic maintenance, and car loan payments in mind.

How Much Does the Average American Have Saved for Emergencies?

No Savings Less Than $1,000 $1,000 to $4,999 $5,000 to $9,999 $10,000 and Up
% of Americans 34% 35% 11% 4% 16%

What Issues Make People Leverage Their Emergency Funds?

If you have an emergency fund, it can be temping to use it for a variety of reasons. It is convenient because it's just sitting there and you're not currently using it.

High Debt

People who have a lot of debt, or that have a lot of high interest on their balances find it much harder to save than someone who has little to no debt. They see it as more practical to pay off their debt than putting money in an account and leave it to sit. This might be a good idea in the long run, but if you have an emergency come up, you'll be putting yourself right back where you started.

Lack of Job Stability

If you work in a job that pays a lower wage and doesn't offer benefits, you're more likely to dip into your emergency fund to cover the cost of a payment that is due. If you work in real estate and you get paid based on commission, you may have to save for when times are slow, and you're not guaranteed a paycheck or steady income. Self-employed people also have a hard time saving because they can experience massive fluctuations in their income levels. This means they can save a lot when times are good, but they need it to live on when they're not.

Not Starting Early Enough

If you're starting your emergency fund later in your life, it will be harder for you to stay out of it. Also, the earlier you start saving, the more time you have to accumulate your emergency fund. You'll also be giving it a longer chance to grow from the interest rate on the account.


One of the main reasons people leverage their emergency savings is from overspending. They buy something they can't afford, and then they're short for a payment they have to make a mortgage or a credit card payment. The emergency fund makes it easy to pull money out whenever they overspend because they don't think they'll ever really need it.

How Should You Store Your Emergency Savings and Why?

There are many options available for you to choose from when it comes to emergency savings accounts. A lot of it comes down to personal preference because each type of account has positive points.


It may be a good idea to keep a small stash of emergency money around your home. You could invest in a small safe or in a lock box to store it in. This wouldn't earn you any additional money in interest, but you would know it is close at hand and that it is accessible if you need it quickly.

Checking and Savings

You could open a completely different account for your emergency fund that is separate from everything. You will still get an interest rate, but it will be a lower amount. You'll also get a checkbook or a debit card, so you have easy access to your emergency fund when you really need it.

Mango Money Card Savings Account

If you're okay with having and using a prepaid card, this could be a good option for you to use with your emergency fund. If you set up a direct deposit with the Mango Money Card, you will get the option to open a savings account that is attached to the card. You will get a 6% interest rate on the first $5,000 you deposit. If you choose not to make a direct deposit, but you still open a savings account, you will get around a 2% interest rate on the first $5,000 you deposit. This interest rate is significantly higher than most savings accounts. However, you should note that if you have more than $5,000 in the account, the interest rate drops down to 0.10%.

Money Market Account

This type of account acts like a hybrid of a checking and a savings account. While you can withdraw money from it, most banks limit this to three times a month. A Money Market Account is a good option for someone who has trouble staying out of their emergency fund. This account is usually insured by the FDIC for up to $250,000, and this account will normally have a higher interest rate at around 1%.

No-Penalty Certificate of Deposit

Regular certificate of deposits hold money for a preset amount of time, and if you take the money out before the time is up, you will be charged penalties and fees. No-penalty certificate of deposits offer you a better interest rate than your average account, and there are no fees if you have to withdraw the money earlier than you expected. You could be eligible for an interest rate of 1%.

Online Banking

Online banking is another option for your emergency fund. They're less convenient than a regular bank because you can't just walk into the lobby and make a withdrawal. They have lower overhead costs so that they can offer higher interest rates on their savings accounts. Ally Bank has an interest rate of 0.87% and Capital One 360 has an interest rate of just over 0.67%. While these aren't high amounts, they're more than you would get at a traditional bank.

Comparing Account Options

Cash Checking Mango Money Card Money Market Account No-Penalty CD Online Banking Savings
FDIC-Insured No Yes Yes Yes Yes Yes Yes
You Get a Checkbook No Yes No Yes No Yes No
You Get a Debit Card No Yes Yes Yes Yes Yes Yes
Limited Transactions No No No Yes No No Yes
Unlimited Transactions Yes Yes Yes No Yes Yes No

How Do You Keep Your Money in Your Emergency Fund?

Half the battle of having an emergency fund is keeping the money in the account. It can be so tempting to go pull some out if you find yourself short on cash, but this will only set you back.

  • Get a Separate Account. You don't want your emergency fund mixed in with your money for other expenses. This is an easy way to drain the account quickly. Set up a totally separate emergency fund and don't pull money out.
  • Make it Harder to Get the Money Out. Don't tie your emergency fund to your checking account, this makes it easy to pull funds out. It is a good idea to set up your emergency fund at an entirely different bank. This way you'll have to go out of your way to get your money.
  • Understand What an Emergency is. An emergency is when you need money for an urgent matter. This is something you can't put off for a week or two; you need money now. For example, maybe you lost your job, and your mortgage is due, or your car needs immediate repairs.
  • Use it as a Last Resort. Every time you go to reach for your emergency fund, seriously ask yourself if you need this now or if it can wait without further damage until you get you next paycheck. Around 90% of the time, you'll be able to wait until you get more money. It is just all about prioritizing, and it will take time to learn this.


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