The emergency fund question everyone’s asking 🤨

With everything that’s been happening with the economy lately – tariffs, job uncertainty, and layoffs – I’ve been getting a lot of questions about emergency funds. 

Specifically: How much is enough?

That’s a good question because a lot of people hear “emergency fund” and assume they know what that means. The reality is, the amount one needs differs from person to person based on their unique situation.

Think about it – when was the last time you felt completely secure about your job? The economic uncertainty we’re experiencing right now has made having that financial cushion absolutely essential.

What exactly is an emergency fund?

An emergency fund is money you set aside specifically for unexpected situations when you might lose your income or face major expenses. It’s your financial safety net.

How to calculate what YOU actually need

Typically, experts recommend you save anywhere from three to six months of expenses. 

However, how do you figure out what that means for YOU?

Take a look at your monthly expenses and ask yourself, “If I had no income tomorrow, what would I absolutely still need to pay for?”

I am talking about your must-haves like rent, car payments, groceries, and things you literally cannot skip. 

There are also other must-haves that can vary from person to person. For example, therapy for some people is necessary, whereas for others, they can skip it for a month. This is very subjective – what’s essential for you might be different from what’s essential for your friend or a family member. So, evaluate accordingly.

Your job type determines your timeline

The stability of your job and how fast you could land another one are the biggest factors in how much you should set aside for your emergency fund. For instance:

If you have a very stable job – like a nine-to-five salaried position or shift work where you know that if you got laid off today, it’d be very easy to bounce back, then three months is what I’d recommend. However, if you’re able to save for more months, that’s always better for your peace of mind.

In my accountability group, I work with a lot of pharmacists, nurses, and people whose jobs are really in demand. So if they lose their job now, they can bounce back pretty quickly. For them, I always say three months is good enough.

Now, for someone who also has a nine-to-five job but in tech – say a software engineer – the pay can be great, but if they lose their job, it could take three to six months to find something equivalent. That’s why, especially right now, they should aim to save at least six months of expenses.

Someone who’s self-employed – typically, I’d say a whole year of expenses should be saved because we never know what could happen to our businesses. 

This has been a pretty slow year for most content creators. This is such a strong example of how unpredictable self-employment can be. People with businesses directly affected by tariffs are dealing with the same thing and are making way less profit this year. That’s exactly why I don’t recommend having only three to six months of expenses saved if you’re self-employed.

More responsibilities require a bigger safety net

Unfortunately, there’s no simple formula that works for everyone.

If you have more expenses than the average person, you will want to save more. 

For example, if you have a mortgage, you want to save more than someone without one. If you have kids, you want to save more than a single person. When you have more people depending on you or bigger financial obligations, your safety net needs to be bigger too. 

You also have to check in with your emotions and figure out what will make you actually feel secure enough that if you were to lose your job, you wouldn’t panic.

That’s your number.

Because, as much as I could say, three months, six months, or nine months – at the end of the day, what makes you truly feel comfortable is going to give you the biggest peace of mind.

Where should you keep your emergency fund?

Your emergency fund shouldn’t just sit in a regular chequing account earning nothing. You want it accessible while also growing with inflation.

Here are three options that give you higher interest rates than typical banks:

• EQ Bank – Currently offering competitive rates on savings accounts 
• Neo Financial – Great for high-interest savings with no monthly fees
• Simplii Financial – Has accounts that offer solid returns with easy, no-fee banking backed by CIBC

These accounts give you the liquidity you need while actually earning you money on your emergency fund.

I’ve linked my referral links for each of these. If you decide to open one, using my link is an easy way to kickstart your emergency funds.

Your next steps

This week, sit down and actually go through your monthly expenses. I know it sounds boring, but trust me – you need at least an hour to look at everything you spend money on to figure out what’s truly essential.

Multiply that by the number of months that makes sense for your employment situation and personal circumstances.

Then look at that number, and ask if you need to adjust that amount to actually make you sleep better at night, knowing that whatever happens, you’ll be okay?

That’s your emergency fund target.

Remember, building an emergency fund doesn’t have to be perfect. Start where you can, and build it up over time.

For a more detailed understanding of this topic, watch this video where I deep dive into emergency funds:

If you want help figuring this out (and actually sticking to your savings goals), I’ve got something for you.

So you know those pharmacists and nurses I mentioned earlier? 

They’re part of my accountability group, where we all work on our financial goals together. We’ve got pharmacists, nurses, tech workers, entrepreneurs – all kinds of people who are serious about getting their money right.

Honestly, it’s been so helpful to hundreds of people. Instead of me just telling you to save six months of expenses and you going “Okay, cool” and then never actually doing it, we actually work together to make it happen. 

We have monthly live sessions where I bring in experts to talk about real estate, taxes, and entrepreneurship. 

We also have accountability hours where we sit down and work on our financial goals. And we help each other figure out money, like, what do you actually spend? Where are you going to put this emergency fund money?

And when you’re second-guessing yourself like “wait, is this really enough for me?” you’ve got other people in the community who can help you think through it.

If you’re done with just reading about emergency funds and want to actually build one with people who’ll keep you on track, come join us.

Join my accountability group