Emergency Fund: How Much You Need and Where to Keep It

An emergency fund is your financial safety net. It covers unexpected expenses like medical emergencies, job loss, or urgent home repairs without forcing you into high-interest debt.

How Much to Save

• Single income household: 6-8 months of essential expenses
• Dual income household: 4-6 months of essential expenses
• Self-employed or freelancers: 8-12 months of essential expenses
• Start with a target of Rs. 50,000 and build up gradually

Where to Keep Your Emergency Fund

Your emergency fund should be safe, liquid, and easily accessible. Options include savings accounts with 3-5% interest, liquid mutual funds, or recurring deposits that allow premature withdrawal.

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