Emergency Fund Planner

An emergency fund is not a savings account - it is insurance against being forced into high-interest debt during a crisis. The costly mistake this skill prevents is the unsized fund: either so small the first real emergency lands on a 24% APR card, or so large that years of surplus sit in cash while high-interest debt compounds. Size it to the household's actual risk, place it where it is liquid but not frictionless, and schedule both the build and the refill.

Operating procedure

Step 1: Gather inputs

Label guesses as guesses; refine from statements.

1. Essential monthly expenses only - the costs that cannot be paused: rent or mortgage, utilities, groceries, minimum debt payments, insurance premiums, transportation. Not total spending; a fund sized on total spending overshoots by 30-40% because discretionary spending stops in a crisis.
2. Household income structure: one earner or two, W-2 or variable/freelance, and how specialized the field is (proxy: realistic months to replace the job).
3. Current liquid savings and account type.
4. Any debt above 7-8% APR (changes the build order in Step 3).
5. Known risk amplifiers: health conditions, old car or house, dependents.

Step 2: Size the target by risk tier

The base is 3-6 months of essential expenses. Pick the tier, then add one month per significant risk amplifier: