#111: Is $1000 a big enough emergency fund?

Season #1

Join Josh and Emily to discuss whether $1000 is a big enough emergency fund…and more specifically, how to determine how much of an emergency fund you actually need.

Top takeaways:

  1. $1000 is a truly arbitrary number. It hasn’t changed in decades and isn’t based on income or expenses.
  2. In order to determine a good emergency fund benchmark, you have to figure out what your emergency fund should cover (medical bills? Job loss? Home repairs? etc.)
  3. 3-6 months is common, but that’s a HUGE range.
  4. All rules of thumb are, by definition, wrong.
  5. In a true job-loss emergency, the goal should be to keep things status quo, not have to cut everything else.
  6. “New tires” should not be an emergency–it should be predictable.

Want help building or growing a successful financial coaching business? Find resources below based on where you’re at in your journey: