How Much Should You Have in an Emergency Fund?

1 A common target is three to six months of essential expenses, not three to six months of income.

2 Start with a smaller milestone of one month of expenses, then build from there.

3 Base the number on needs only: rent, food, utilities, transport, insurance and minimum debt payments.

4 Keep it in a separate high-yield savings account so it earns interest but stays easy to reach.

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