We asked 20 experts: How much savings should you really have?

This year is a pretty good example of why emergency savings are important. Conventional wisldom is to save three to six months’ worth of expenses for a rainy day, but that may no longer be enough. Millions of workers have lost their jobs because of the pandemic, and without a government stimulus plan, some people are living off their savings.

There’s no one-size-fits-all emergency plan. How much you should save depends on your current financial picture, family situation and future goals. We asked 20 certified financial planners how many months of savings you should have, and results were surprisingly split.

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Q: How many months of emergency savings is best?

We asked 20 experts: How much savings should you really have?

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Why some experts say 3 to 6 months:

Some experts think savers should stick to the rule of thumb, especially if putting money in your emergency fund takes away from investing goals.

“Everyone needs an emergency fund of three to six months of living expenses. Before paying off debts, make sure there’s a rainy day fund to keep from going into more debt when something expensive and unexpected happens.”
Douglas Garrison, certified financial planner at Investec Wealth Strategies

“I advise clients that a range of three to six months works well unless there are specific goals they are saving for which require more, like a down payment on a house or buying a car. If, however, a client is married and there is a second income or if the client’s job security is perceived to be very high, the lower end of that spectrum is preferred. Since cash isn’t yielding much these days, too much cash waters down the client’s overall return.”
Michael Simmons, certified financial planner at Transitions Wealth Management

Why some experts say 6 to 12 months:

These are unprecedented times, and if you’re able to put more towards emergency savings, some experts say you should.

“Before COVID-19, I recommended three to six months. Now, though, I think people need to be covered for longer periods. If there is an example of why people need emergency savings, COVID-19 is it! These funds need to be in a bank savings account — not invested in the security markets.”
Sallie Thompson, certified financial planner

“Larger emergency funds could be appropriate for a homeowner, people with high-deductible health insurance plans, pet owners and people with variable income such as someone who earns a large amount of compensation from commissions.”
Joseph Stemmle, certified financial planner at Ameriprise Financial

Why some experts believe in the 12-month emergency fund:

“I used to recommend keeping three to six months of expenses in savings. Then the financial crisis hit. Since then, I have recommended 12 months of expenses.”
Thomas Rindahl, certified financial planner at TruWest Wealth Management Services

“Having an emergency fund or cash reserve established for you and your family can make or break your financial life. A financial emergency can be a speed bump, or it can be a financial tsunami if you are not prepared. An emergency fund can soften the blow and help you deal with life’s unexpected curveballs, like unemployment.”
Jay Spector, certified financial planner at Barton Spector Wealth Strategies

Want to recession-proof your money? Check out our free ebook, “50 Money Moves to Make in a Recession.” You can download it here.



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