How Much Do You Have in Your Emergency Fund?

Current times have started getting me thinking, just how much of an emergency fund is enough?

I'm curious to know, how many months of cash do you have deliberately set aside in your emergency fund? (in terms of months worth of living expenses)

Poll Options

  • 131
  • 28
    Less than 1 month of living expenses
  • 38
    1 month of living expenses
  • 28
    2 months of living expenses
  • 113
    3 months of living expenses
  • 18
    4 months of living expenses
  • 8
    5 months of living expenses
  • 105
    6 months of living expenses
  • 26
    9 months of living expenses
  • 676
    12 months of living expenses


        • If this for all your assets or just emergency savings.

          • +2

            @AH: My partner and I have one savings account each. Mine has all the savings for assets (for a property purchase hopefully later year) and hers includes emergency savings which would get us for over 12 months in case both of us do lose out jobs.

            She has stocks from prior to our relationship in the States and has taken a big hit recently. Either way, I dont understand the stock market, call me a noob!

        • +1

          Do you have super? That would be invested in the stock market, unless you've changed it to cash. It's worth your time to learn about investing (especially in no-frills index funds). The stock market is the best place to keep your money long term (10+ years). Not doing so will cost you a lot.

          • @Autonomic: I do have super. One thing I have considered is contributing more to super maybe after a year or 2. Reluctant to do it now as they have and are taking a hit.

            I need to get my hands on "Barefoot Investor" as well to get my head around a few other avenues for knowledge before deciding what to do.

            I will consider you idea of researching into no-frills index funds. Never heard of it before :) again, noob mistake.

      • +1

        …investing honestly feels like gambling - should you keep on holding or sell now to gain profits/cut losses

        • The common consensus is to invest regularly into index funds and only withdraw on retirement. This follows the consensus that the output of the US economy and overall value of the overall stock market should gain eventually alongside your index funds.

    • +3

      General savings will become your emergency fund if push came to shove for most people.

      So it’s one in the same really.

      I hit the 12 month option as i have enough in savings to go 12+ months no income for the family.

      In saying that, thats not What the money is specifically for, if we want a holiday etc We use it.
      but our savings never dip below 3 months of “emergency” money intentionality though.

      • You can't claim it's 12 months of emergency funds because it's not. If you decide to go on a holiday and blow 9 months of those 12 months worth of savings only to find out you both lost your jobs when you arrive home, then your emergency fund is 3 months, not the 12 you previously anticipated.

        • +1

          But then most people probably don't have any emergency funds, as they would likely dip into those funds for large purchases, house, car etc.

    • +4

      You could get a better return than savings/cash accounts, but there's always a risk/reward trade off. I have lived in Australia about 10 years and have never kept any money in a "savings" account, as once tax and inflation is factored in it's most likely a negative return. I keep all of ours in our mortgage offset, which essentially means 2.39% return with no tax (not accounting for capital gains/losses). Sure I could stick it all into shares and maybe get 5-10% return per year, but could also lose 30% if another market crash comes.

      I'd rather keep this emergency fund at a lower rate of return and get debt free as quickly as possible/with minimal risk. I do have additional funds in shares, but I only invested what I was willing to lose.

    • +1

      I almost have 2 year's salary but, that's the house/illness fund.

      I also have a secondary savings that I have 1-2 month's salary in there for more pressing needs because I'm determined to never need Centrelink again.

      Take some time to think why people might have that before you comment.

    • I said 12 months, but most of my money is in shares. While they could go down to zero it's liquid enough that I can cash it out when needed.

      I suppose the question was explicit about cash, so in that case 3 months

    • If you have 12 months of reserve in your offset account, depending on what your interest rate and margin tax rate is, your return on investment is pretty damn good.

  • +3

    I left my job in May 2018 to travel prior to going to graduate school in a foreign country. I worked over May-August last year but aside from that have been jobless the whole time, and could probably go another year or so without working before being flat broke. So I guess around 3 years?

    However I had planned ahead for this, generally I'd aim to have 6-12 months in a relatively liquid form. I live pretty frugally in general, even when I was working, so I don't need a huge amount of money to get by.

  • +11

    5-10 years of expenses

    • You retired?

      • Nope, just save heaps and have most of the house offset, and no kids yet..

        • +2

          That makes sense. I have 2 kids but paid the house off. My offset offsets my investment loans. I only have 2 years saved though.

    • Same. All parked in offset. Got a small etf portfolio which if we sell at current price will net us 2 years worth of expenses too but if we have to resort to selling then i guess it will be down by half at least.

  • +8

    Go bush and live off the land…

  • +1

    Understand that emergencies are not all the same. It could be a personal emergency such as loss of employment, non-Medicare funded health issue, law suit, uninsured accident. Or it could be a national or international emergency, such as a GFC, global pandemic, war. In the former, you may be able to get help from family, friends, sympathetic bank, landlord, etc. In the latter, which seem to be more common recently, not only might those close to you also have financial troubles, but you could also have trouble accessing your emergency funds. In the GFC, some (yes, Australian) investment funds blocked withdrawals, and in some other countries banks restricted or blocked customer withdrawals.
    I don’t advise keeping cash or gold under your mattress, but do be mindful that in an emergency you would want ready access to meet your short-term commitments (cash for food, rent, etc), moderate access for medium term commitments (easily converted to cash, such as shares, managed funds), and last resort for the long term (investment property, super, your home). Ie a staged access to funds as need dictates.

    • What if banks do a 'bail in' similar to Greece in 2013 ?

  • +1

    Shares and savings would give me 18 months. Home loan I have knocked around 10 years off too. I could go without a job for quite a while but while I’m working I’ll continue to knock off debt and invest.

    • what sort of return are you getting from shares that it is better than getting rid of the mortgage?

      • +2

        Mortgage 2.8 percent, share dividends 5 percent fully franked.

  • I have about 3 months of cash available based on our living expenses. But could probably cut do the 10k a month expenditure to make it last 5-6 months.

    Probably have enough equity in the property to not have to make mortgage payments for about 3-4 months too.

  • I chose to keep my money with the tax office, yeah I pay my taxes. If there is a real emergency I'll withdraw from centrelink.

  • Thank goodness we are on a fixed income, 2 pensions from different countries plus own Super, all of which covers our expenses with some to spare.
    Plus we have investments in cash, bank accounts, shares, and gold, which could be used when necessary.
    So all our requirements are covered until we die.

  • 2-3 months worth in cash and cash equivalents, 12+ months worth in short term investments that can easily be turned into cash . Usually I actually hold around 6-12 months in cash equivalents but there have been some very good investment opportunities in the last few months.

  • It's worth getting income protection insurance IMHO

    • +2

      Most dont cover redundancies under such policies, some do but are usually limited to 3 months of payments. Having said that I do agree on that everyone should have income protection insurance.

      • they usually have this as an optional extra for extra cost with waiting periods. Would not be surprised if they are very cautious about accepting cover at the moment for this given current climate or if a redundancy due to covid would come under the existing conditions type exclusions.

  • I've got about a months worth of real emergency funds (ie lost access to all bank accounts and investments). For just a 'loss of income' emergency I reckon that counts as early retirement, so would count all my savings for retirement there, could probably make it through to pension age if I had to.

  • +7

    This poll is definitely going to skew towards the higher end and probably doesn't represent the wider community, if anything it just represents the frugal nature of this website.

    Personally I am around 6-9 months, would have to do the numbers, but I know a number of people who at the start of Covid19 thought that they would be able to survive maybe 1 month max if they lost their jobs.

  • +3

    Everyone should try and be six months ahead on mortgage repayments. It's not easy, but it's a worthwhile goal if you can do it.

    • Good advice but worth noting Banks can refuse a redraw.

      Safer to keep it in offset to be sure you can access it when required.

      The only downside is the temptation to use the money since it's easily accessible.

  • +2

    COVID has taught me a lot about my finances and how the people I love see theirs. I have had an open and honest dialogue about it and so, I'm grateful.

    I have 12 months + spare but, only because it's for a house + recent life altering illness has got me saving severely.

    It does make me scared for the people who do not have any savings but, I have been on that side of the fence too so, I understand.

  • +21

    Around 10 years ago I was on disability for almost 2 years (~$230/w)… all of my money went to pay for living expenses (rent, food, clothes, etc) and I had to rely on my own self and some very generous and understanding friends for entertainment. It was literally money to mouth every paycheck then. I also defaulted on my credit cards which sucked big time. I was fortunate to have close family and friends who cook extra just to share food with me, because they know I wouldn't accept money from them.

    Fast forward to now, after a lot of patience and hard work I'm able to earn a very solid income (low 6 figures), but my experiences dictate how I live. I still drive my 2004 camry, still live in the same place, same furniture and appliances, paid off my credit card debts and vowed never to open another account. I'm very conscious of my spending and always think back to how I used to live every time i feel impulsive and complacent. Barefoot Investor also helped a lot in how to start off with my finances.

    On topic, I definitely understand and have experienced what it's like not to have any money set aside. Now I have a 6 month cushion set aside for emergencies, on top of other untouchable emergency stash accounts and savings.

    The end.

  • +11

    Whats the bet that most people who voted for 12 months dont even have an emergency fund set aside and just calculated based on how much savings they currently have? And no, withdrawing your super isn't your emergency fund. And also no, your jobkeeper money isn't your emergency fund either. The result is bs.
    Judging by the number of people in the last 3 months who instantly overnight became 'completely broke' just by losing their job, speaks volumes - most people dont have an emergency fund and live day by day/dont budget.
    Vote what you will but just know you're lying only to yourself/in denial if you are.

    • +4

      Eh, what do you expect on an internet forum?
      Happens every time that someone asks what is your income

      • +9

        Considering the median income for OzB is 200k a year and 50% of the OzB are landlords, the results are correct.

        • Judging by the number of people in the last 3 months who instantly overnight became 'completely broke' just by losing their job

          Backs this up as well. If you lose a 200k job, and tenants can't pay rent. Easy to default on mortgages.

    • +4

      The people who choose to read and respond to a post about emergency funds are more likely to be those who have thought about such things, and quite possibly done something about it. Similarly those who respond to posts about investment properties, loosing jobs, etc.

    • I have around 4 years expenses saved up. Back at Uni as well so saving up the covid supplement. I’ll do some casual work in the health sector one the supplement up runs out. My only luxury is overseas travel so yeah

    • I guess we'll never know if the votes are correct or not but I voted 12 months and I definitely do have more than that.

    • +1

      Depends how you deem an emergency fund really. I have well over 12 month expenses sitting in a bank account at the moment. I'm saving for a house deposit - so would rather not use it in an emergency - but it's there and available for me to use if required.

      I then have some more in ETFs, so that's a little harder to retrieve, but still possible if absolutely required.

      There's bound to be plenty of younger people like me, who don't yet own large assets - like houses, but are saving up for them.

  • +3

    12 months in cash
    A further 6 months in gold

    On top of this around 6 months guaranteed income (across two household incomes) due to notice periods, leave, long service etc.

    I’m starting to think the cash & gold isn’t necessary and just stick it in an etf except for ~20k to cover bills.

    • +3

      " notice periods, leave, long service"

      Those are only good if the company has the funds to pay them out if you leave or they end your employment with them.
      If they're going in to administration etc then many of those can disappear overnight and you never see them again. (been there!)

      • +2

        Very true, both workplaces are low chance of going into administration and they are based in different countries and different industries.
        So yes, you are correct but this is not so relevant for my example.

  • +2

    I try to keep at elast 10k in my everyday savings (rent, bills, utilities, etc gets paid from there).
    Currently hovering around 5k in it due to a slight shift in savings goals but plan to be back at 10k by Sept.

    So I always have an immediate 5k I can call upon without dipping into my savings savings (currently doubling as my buying-first-home-savings)

  • -1

    About to embark on building a house and land package worth just over half a mil. At the end there will be a flat $20K left over in savings with a mortgage of about 260K.

    I'm a government worker so don't have to worry about being out of work.

    • There are so many things wrong with this comment

      • How so? You have absolutely no idea what I do for work or what my level of job security is like.

  • +5

    Won't matter how much you got if the money turn worthless.

    • the question is when?

  • -2

    Makes me feel bad to see so many has emergency funds for years. Every extra cent I have is in the offset account 😒

    • +7

      Most if us are treating money in offset as emergency fund.

    • Well that's what you do when you have a loan. Most of my "savings" is in the loan too. I maintain a couple of thousand in the everyday account for quicker access, like bills and credit card repayments but if it really was a rainy day situation (i.e. no job) the couple of days it may take to transfer out a whole lot of money from the loan isn't a big deal.

    • The whole idea of an offset account is so can draw on it in an emergency, but you get a better rate offsetting your loan than having in a savings account and it's tax free

  • +3


  • we have a $1m mortgage (sydney), and wife's just had 12 months off for maternity leave (sorry, parental leave, can't call it maternity leave anymore…), and somehow our cash account (offsetting our mortgage) has increased on single income only… so thats positive.

    So if one of us lost our job (we earn similar), we can survive by being frugal indefinitely, but we have probably equivelent of both of our incomes post tax sitting in cash in our offset… so i suppose a couple of years of emergency, including mortgage repayments.

    Planning on upgrading to a larger house, increasing our loan etc in the next few months as wife returns to work… so things could change. but yeah, i think we're pretty comfortable.

  • I'd also be curious to know at what point in time they came across this need to save and the information on best methods etc.
    If it was knowledge that came from family that pushed it as a life skill or lesson, learnt the hard way by running out of cash or getting in to a bad financial position etc.

    It's something that was never really taught in schools I went to (any real sort of useful budgeting and finance related matters), parents never spoke of finances or saving etc to set any real example of value so its been YOLO for ages then looking more to putting savings aside for various reasons.
    People may laugh at those who don't know or are in a poor position however its not a great way to run a country if everyone has cash and can pay their bills without the need for lending for everything.

  • Why you no have an option of 12+ months? Or perhaps > 12 Months?

  • +3

    for those with 12 months or more, do you keep them in
    1. cash? bunker?
    2. stocks?
    3. some fixed deposit scheme?
    4. digital currency?
    5. tesla?
    6. beer tab?

    • +4


    • -1k monthly expense (debit card)
      -10k savings account (get some interest while also being highly liquid to top up debit when needed)
      -rest in ETF's, so still reasonably liquid but not ideal in a crash like at the moment where withrawal = realised loss.

      Although at the moment I'm not buying and instead raising the cash reserve for travel/unemployment risk

    • Savings account.

      I don't consider investments as part of my emergency fund despite them being pretty liquid.

  • +2

    35k in annual leave and long service if I get the sack. I could live of that for at least 9 months. Before using some savings.

    I would hope employer gives me 4 weeks notice on top if they sack me.

    • +5

      How big is your company though? If it's a small one and the CEO runs off to Tasmania with the super funds… might be a long time if ever that you could ever see any of that.

      • +4

        Exactly, this can change quickly and administration etc will wipe all of that annual leave and long service (sometimes plus unpaid super) out.

      • +2

        Not likely. Work for a big company with product that will be needed indefinitely.

  • If I had 12 months living expenses, I wouldn’t be on Ozbargain. Sure, I would still be frugal but I’d value my time more.

    • i'd prob be broke in a day at best a week…

  • $200k in cash in savings accounts.
    It’ll be my mortgage deposit someday, or not.

  • +8

    Funny only the people with savings speaking up.

    I have nothing saved and pretty much live hand to mouth. Thank god centrelink has come through, has been a lifeline.

    • +4

      I wouldn't feel too bad, most people on here actually think they have savings but in reality they have nothing (even negative). Remaining cost of the mortgage, car repayments, credit card, school fees, and every other contract and plan they're on still needs to be paid. If they think their 3-12 months savings is going to cover them when they owe hundreds of thousands of dollars… "Tell em they're dreaming". Majority of Australia is low to middle working class, who are in so much debt they'd only pay it off when they hit retirement age.

      • +1

        Ah, yeah, but, I'm not going to be homeless if I couldn't pay my mortgage, the idea is how much savings you have to keep up with the repayments and keep a roof over your head.

        • What happens if there are no jobs if you lose yours? Then you'd be on Centrelink living week to week. All the money you saved will have to be forfeited to pay off everything. House would be foreclosed, etc. Plus you'd owe so much more on top of that. You'd lose everything you've worked for because it was never yours to begin with… Mortgage literally translates to death agreement. Like I said add up all the money you owe then subtract your "savings" and figure out how much you'll be living on. I'm gona go with $0.00. Simple maths

          • +1

            @Monstalova: Look hard enough, you will find a job. That's nonsense talk. I have 12 years left on my mortgage and I will be 45. Paying minimum amount. Stop being so dramatic. It should take you 6 months to find another job, have enough savings for 2 years. It is simple maths.

            • -1

              @RocketSwitch: Tell that to the hundreds of millions of people out of a job around the world right now. Australia has had it a little easier than so many countries. If this gets any worse then there won't be enough jobs to cover everyone. It's funny you think you still have savings! You don't own any of the money you have right now.

              • @Monstalova: Can still live for 2 years on the amount I have "saved" without work, interest only, maybe 3. So, not sure what's funny.

  • +10

    I hate these kinds of posts - feels like a big d*ck swinging contest

    • +4

      In forums like these, you can't have rational discussions, be moral and just. You take what you can, give a little without judgment and leave the rest.

    • Its no more big d!ck swinging than everyday life, people with huge houses, flash cars and whatever else they can show off or tell you about.

    • +4

      Or maybe a wake up call for people who maybe aren't there yet

      • +3

        Dunno, can't say I want all that huge debt that I see many dealing with. I like nice stuff but i'd hate to have a million + mortgage and be slaving away for all my life to keep up with others and try pay that off.
        Given how many people I've seen not even make it to retirement to be able to cash out after all of the effort put in to be able to enjoy retirement or things later in life pre-retirement, I'm questioning the point of it all.
        Yes need to be comfortable and be able to survive periods of time with no work, pay your bills, keep a roof over your head but at the cost of everything else in between is interesting. Not saying all are doing that here, I'm just not on the average $200k OZB income ;)

        • But with the government property guarantee, that $1million debt will be $3million in equity when you retire, compared to $200k in a crappy super you've paid into all your life.

        • +1

          Fully agree with you. It's this mindset that people have had drilled into their head from young. You have to marry, start a family and buy a house. Must have been all the bank advertising lol. Seems crazy to put you and your family's life in the banks hands.
          For people who are struggling to pay mortgages from the beginning, I can't understand why they would even think of doing something like that. Sacrificing your life to own a house does not make any sense! IMO you'd need somewhere near half the money and be very well off to even think of buying a house.

          • +1

            @Monstalova: What do you suggest then? Paying rent for the rest of your life? Which is equivalent and assured death sentence. Live within your means.

            • @RocketSwitch: Well if you're going to have to struggle and skimp to take on loans with interest then be locked in to that contract for decades. Then don't try "buy" a house. We're seeing the repercussions of this tradition now. Tens of millions of people globally in financial ruin from trying to do this. With renting you have any problem fixed with the house straight away and not in debt to banks which will give you bankruptcy if you can't pay it. How is renting a death sentence when you have so much freedom with it? People that do have a lot of money to begin with I can understand buying as there'll be less time to pay it off, but they seem to go in the opposite direction and just try and get bigger houses which cost more money which means even more debt. These times have shown that it's definitely a huge risk no matter what your situation is. No such thing as easy money

              • +4

                @Monstalova: I agree. Those who buy bigger houses and live way above their means have a few problems coming their way. But, I would say many people like me who opted to buy within their means and pay off the mortgage in 16 years. Better than rent in my opinion.

  • 2 years at the moment. Always save 30% of my income in savings because you just don't know.

    • Have you considered that 2 years might be a bit much? The money would work harder for you in investments over the medium to long term.

      • +1

        I have a mortgage so it sits in an offset account.

  • +2

    some veggies, chickens, ducks and dogs in the backyard, 1 rainwater tank around 500 litres,
    cans food, dry food….

  • +3

    Have enough for 10 years…. In a different country

  • +6

    Offset accounts are emergency funds TBH - We have a $770k Loan, with $350k offset - we structured it in such a way that we could have had a lesser loan, and lesser savings; but opted to do it the way we did.

    Things go bad, we can take some offset money without depending on any other assistance. Repayments on the mortgage are quite low, and our small spending amounts leave banks gobsmacked, so it would last us quite a long time. We're also insured for income protection (though like that will ever pay out..) any significant event meaning we're permanently out of work would hopefully trigger the insurance.

    Wife is finishing up work soon and its just me, but fairly comfortable and we're both in very early stages of life - we could survive easily 5+ years without additional support. Worst case, we could sell the abode.

    Treat every $1 you spend, like you've got to pay $2 back - and save, save, save.

    • +1

      My very risk averse mindset would say to pay $100k of that offset into the loan or invest elsewhere. Government guarantee on ADIs is up to $250k. Unlikely (depending on the institute of course), but at least I know it's safe if everything goes belly up!

      • +1

        I'm in a similar boat.. when I refinanced my mortgage with another bank last year, I actually had it refinanced at the loan amount but then put everything back in as extra deposits. I've got about 15% left of my mortgage left, but 65% as redraw. Is this a bad use of my money? I figured lowering interest rate was the best option?

        Taking a look at ADI schemes, they are all much lower on interest rates? Am i missing something here?

        • +1

          May have caused some confusion here. Basically the Federal Government has guaranteed the individual deposit accounts of any Authorised Deposit Taking Institution (bank, building society or credit union), up to the value of $250k. So if your bank was to go under, up to $250k in your savings/offset/deposit accounts is essentially guaranteed by the federal government, anything over $250k is essentially at risk.

          It seems like an unlikely occurrence, but just look at what happened to UK/US and other international banks during the GFC. If I was Oipjo I would pay down my loan to $670k and keep $250k in the offset as you are in the same financial position, but that $100k is very safe. Depending on the loan account, you can still access it at any time as well if you need to.

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