Worried About the Economy Amid Trump’s Tariffs? Building an Emergency Fund Can Help.

How much should you save for emergencies?

Vanguard recommends setting aside $2,000 or half of one month’s expenses, whichever is greater, as a buffer for unexpected expenses like car repairs or medical bills. To protect against job loss, continue saving to build a buffer of three to six months of living expenses.

Having $2,000 on hand can help cover unforeseen costs without resorting to credit cards. Even smaller amounts of savings can make a difference. Research shows that saving as little as $250 to $750 can reduce the likelihood of serious financial issues for lower-income families.

Consider your family’s circumstances when determining how much to save. If both spouses have good salaries, saving three months of expenses may be enough. If job prospects are uncertain, aim to save six months or more. Setting specific goals makes saving easier.

Some experts suggest setting aside enough to cover a month or two of essential expenses rather than aiming for the three- to six-month guideline. Consider what financial concerns keep you up at night and save accordingly.