Financial experts recommend having enough emergency savings to cover all expenses for at least five or six months. That means even if you earn $5,000 a month, you’d need to save $25,000 to $30,000. If you earn $7,000 a month, the figure is even more daunting: $35,000 to $42,000. Who wouldn’t be intimidated by those steep amounts?

But you don’t have to focus on that lofty six-month goal just yet. You can start small, saving until you have at least $1,000 dollars in emergency funds. Then that achievement can inspire you to keep building emergency savings to a higher amount.

When you are budgeting hopefully you are planning for the future by saving money for vacations or retirement. But are you planning for the unknown? Life is full of unexpected financial emergencies – it’s not a matter of if but when. Medical expenses, car repairs, and job loss all happen when least expected. But do you have an emergency fund to pay for any of the above?

Forty-four percent of Americans can’t cover a $400 out-of-pocket expense, according to the Federal Reserve. Meanwhile, the average emergency room visit can run you $150-$3,000, says a study from John Hopkins Bloomberg School of Public Health – and that’s only one type of unexpected expense.

Did you know that nearly three times as many Americans report having less in emergency savings than they did before the COVID-19 pandemic? That’s according to a new survey from personal finance site Bankrate.

The same survey found that only 16% of respondents are “very comfortable” with the amount they have in emergency savings while 46% – predominantly low-income workers – said they are “somewhat uncomfortable” with their emergency savings amount.

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Whether you’ve drained your emergency savings due to the pandemic, never had much emergency savings to begin with or you’re trying to figure out how much you should save, having emergency savings can reduce financial stress down the road when unexpected expenses strike.

Why you need an emergency fund

As tempting as it may be, don’t berate yourself for not having an emergency fund. Instead, learn your lesson and be ready when the next emergency occurs.

Jobs disappear

In March, millions of people watched their jobs go “poof” with little or no warning. When your income goes away, you need emergency savings more than ever. Ideally, you should have enough saved to keep paying rent or mortgage payments, monthly bills and other expenses for at least a few months.

Saving tip: Sign up with your employer to have a percentage taken directly from your paycheck and deposited directly into your emergency savings account.

Work hours get cut

Even if you don’t lose your job, an employer can reduce your work hours any time, not just in the midst of a health and economic crisis. Companies can also run into financial trouble and cut hours or freeze wages, 401K contribution matches and bonuses. We’re all getting a big dose of that truth right now, as businesses nationwide close temporarily or struggle to pay staff.

Saving tip: If you can, deposit your entire stimulus check from the government into an emergency fund savings account. Even if you can only spare $200, that’s still a good start toward building a basic emergency fund of $1,000. Then keep making regular deposits.

Living paycheck-to-paycheck is risky

You may have lived paycheck-to-paycheck for much of your life and still managed to pay the bills. Now the COVID-19 pandemic is showing all of us how risky that financial path can be.

Saving tip: Always have an amount that’s greater than what you earn weekly, biweekly or monthly in an emergency fund.

Cars still break down

If your car needs necessary repairs, you’ll need to fork over payment, whether you have a job or not. If you’re forced to pay with a credit card because you don’t have emergency savings, the midst of a troubled economy is no time to rack up more debt.

Emergency savings tip: Ask your mechanic what repairs or parts to anticipate in the near future and set some money aside from each paycheck so you can pay with cash.

Anything can happen

If someone told you a few months ago that NCAA basketball tournaments would be canceled, all sports would grind to a halt and New York, Seattle and other major cities would have empty streets night and day, you’d have thought they were crazy.

Now the COVID-19 crisis is the perfect reminder that “anything can happen.”

Saving tip: Every time you have a five-dollar bill, stash it in a coffee can or envelope. Then every week or two, take that cash and deposit it in your emergency savings account. You’ll be up to $1,000 sooner than you think.

You can’t help others if you can’t help yourself

Let’s say you still have a job but your best friend loses hers. Or your older parent needs money to help pay the bills. You can’t easily help people you care about when you have no savings to fall back on if you lose your own job, get sick or have to relocate for a new job.

Saving tip: Sell something you don’t use or need online. Sell a few items and you can open an emergency savings account. The more you have in savings, the more fun it is to add to it consistently and watch the balance grow.

Ways to build emergency savings fast

Open a bank account with a sign-up bonus

Many banks offer bonuses ranging from $100 to $300 when you open a savings or checking account and receive the required amount of direct deposits within the specific time frame. For example, in 2021, Wells Fargo offered a $200 bonus for opening a checking account with a minimum deposit of $25.

To receive the bonus, the account holder needed to receive at least $1,000 in direct deposits. There are savings account bonuses too, but don’t be deterred if the offer is for a checking account. You can treat the account as savings. Besides, you may want to write a check or use the account’s debit card to cover expenses when you have an emergency.

To find bank account bonuses, use the search term “banks with bonuses for opening an account.”

Detox your finances with a spending fast

You’ve probably heard of detox fasts with diet, but did you know that taking a “spending fast” for as little as 21 to 30 days can free up some serious money? With a spending fast, you intentionally cut out or reduce daily and monthly expenses, so you spend less.

For example, if you go out for lunch or dinner every day, commit to preparing most of your own meals at home. To save on gas, try to schedule errands in batches. If you can cut your grocery bill in half by shopping at a discount grocer, go for it. You could cancel or pause a couple of streaming services.

Then take the money you would have spent and deposit it in your emergency savings account. You may even find that the $200 to $400 you saved inspires you to implement some of your new spending fast habits into your monthly budget.

Have your employer make contributions

If you can set up a direct deposit from each paycheck into your emergency savings account, the balance can increase significantly (and painlessly) in a short time. Even $50 from each biweekly paycheck adds up to $1,300 in a year. Direct deposits of $100 from each check could add $2,600 a year.

Earn extra income from a side hustle

One of the fastest ways to add cash to an emergency fund is to earn more money from a side hustle or part-time job. You may not want to work all day at your main job and then work a second shift at a part-time job or side hustle. But if you can commit to working a second job for just a couple of months, you can earn enough to build a respectable emergency fund.

How fast can that extra income add up? Here’s an example. If you work 15 hours a week for eight weeks at a part-time job that pays $15 an hour, you’ll earn $1,800. After taxes, you’ll still have more than enough to save at least $1,000 or more in an emergency savings account.

How to pay for an emergency without an emergency fund

So if you find yourself in a bind without an emergency fund, check out these tips to make fast cash without breaking the law.

Sell your hair

Before you lose your hair due to stress from the money you don’t have – sell it. There are websites where you can sell your hair for anywhere from $100 to $1,000, depending on the quality and length. You’ll be asked questions about whether you drink, smoke, or color your hair. But, in the end, it’s a quick way to avoid going into debt over an unexpected expense.

Sell your plasma

You can donate blood, but that’s usually worth no more than a free meal and movie ticket. If need cash, your plasma is in high enough demand for medical research. The pay rates vary, but you can expect to make $20 to $50 per donation.

The American Red Cross will only allow you to donate plasma once every 28 days. Since this is more about money and less about altruism, here’s a tip: Go to a private blood donation center. Private centers will let you donate twice in one week, as long as there is a day between donations.

Sell your clothes

Have clothes hanging in the closet that mean less to you than the emergency expense you’re facing? Sell them. Stores like Plato’s Closet or Crossroads Trading Co. will pay for your slightly-used clothing. You walk in with a pile of your clothes and in about an hour or so, you’ll walk out with a wad of cash.

Roll up your sleeves and work

Not every tip on here involves selling your belongings or part of your body. Apps like TaskRabbit connect you with local people who pay to have their chores taken care of.

You may have a neighbor looking for help around the house. Maybe they need their lawn mowed, or new furniture assembled, and don’t have the tools. That’s where you can earn money doing those tasks for them.

Sell old stuff at a pawn shop

Before you have that garage sale, check to see if any of your old stuff is valuable. Just be aware that pawn shops rarely offer you the full value of what you’re selling – they’ll offer less than what they think they can get for it.

Crowd-fund an expensive bill

There are plenty of crowd-funding sites out there to choose from, including GoFundMe and Indiegogo. Do your homework before picking one – some, like Kickstarter, only give you the money if you meet a specified goal. While crowd-funding a bill may not be the most popular way to generate money, it has worked in the past.

Sell “handmade” furniture on Etsy

Etsy is a “marketplace where people sell and buy unique goods.” A lot of talented people make a living on it, but so do people who buy cheap furniture and slap a new coat of paint on it. Then there are the “false vintage” sellers who markup mass-produced items by hundreds of dollars.

Sell old gift cards

Websites like will exchange your unused gift cards for money. Don’t expect the exact amount, because the site will only trade you cash for up to 92 percent of the gift cards value. But desperate times call for desperate measures.

Ask people for money

The old-fashioned alternative to crowdfunding. If you don’t have 10 friends and 10 family members, try other places: like church, and your neighbors, and the street corner. (Well, maybe as a last resort.)

Signs you need to fatten your emergency savings

It’s wonderful you have an emergency fund but, is it enough? Below are eight signs it’s time to focus on raising your emergency savings balance.

1. You have no emergency savings fund

There’s nothing skinnier than a non-existent emergency savings fund. And it’s easy to throw up your hands and say “why bother?” when you’re starting from nothing. However, you have to start somewhere, and time will pass whether you begin building emergency savings or not.

So, get started by going to the bank with even a small amount such as $100 to open an emergency savings account. Then make room for regular deposits in your monthly budget. You’ll be up to a respectable balance before you know it.

Find out: 5 Fun Apps to Build Emergency Savings 

2. You’re constantly draining emergency savings

Are you constantly tapping your emergency savings, causing it to dwindle to a scary low amount? Or maybe you only make withdrawals occasionally, but the small amount you keep for emergencies gets gobbled up fast by even the cost for a small car repair.

If this is the case, work hard and make a few sacrifices to increase the amount you have in emergency savings so that one or two emergencies won’t wipe out emergency funds.

3. Your job security is threatened

If you’re in the restaurant, hotel, travel or another industry that’s been hit hardest by COVID-19 lockdowns, mandates and public distrust of safety protocols, you already know you could probably lose your job if the economy worsens or your employer can’t recover from recent losses.

Don’t wait until you lose your job to start thinking about how you’ll pay the bills with no income or reduced income. Start socking away as much from each paycheck as possible not to avoid a dire financial emergency later.

4. You’d be in trouble after a month or two with no income

What if you lose your job or become seriously ill and must take unpaid time off? If you think a month or two of emergency savings will get you by, you may want to reconsider. Even if you have enough to pay for rent, utilities and other bills for two months, you know how life goes.

It’s kind of a given that if you lose your job, you can typically count on other crises riding the back of your bad luck. For instance, what if your car breaks down? What if your dog gets sick and you have a $400 vet bill? What if your favorite aunt dies and you have to travel to the funeral?

Better to have too much than too little saved to get by when emergencies come your way, so find a way to add at least $100 – more, if you can afford it – each month to your emergency savings.

Find out: How to Recession-Proof Your Finances 

5. Your savings covers only the smallest emergencies

Sure, you can cover the cost of a new battery or putting new brakes on your car, but paying for a bigger emergency expense – spending thousands for a new home air conditioner, for example – isn’t within reach. If that’s the case, it’s time to work on fattening your emergency savings to an amount that could cover at least a couple of big emergency expenses at once.

6. You’re using credit cards to pay for emergencies

If you’re charging car repairs, medical bills and unexpected travel plans on a credit card, that defeats one of the main purposes of having an emergency fund. Work on building your emergency fund so if things get tight, you don’t have to rack up more debt on a credit card.

Find out: 5 Things that can Happen When You Don’t Pay Your Medical Bills on Time- or at All

7. You have crappy health insurance

Sadly, many people can’t afford good health insurance, so you’re not alone with your short-term policy that pays absolutely nothing until after you meet your $12,000 deductible. That’s little consolation, though, if you get slammed with a big medical bill.

When you don’t have good health insurance, do your best to build your emergency savings so you can cover an expensive medical procedure or prescription that your insurance won’t pay.

8. You’re a one-income household

Whether you’re single or have a family, if you’re the sole breadwinner, you won’t be able to rely on a second income to pitch in if you lose your job or have a costly emergency expense. But you can always rely on a good-sized emergency savings account to get you through.

So, get started now working up the amount in emergency savings that experts recommend: Enough to pay all the bills for at least three to six months without an income.

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Article last modified on May 9, 2023. Published by, LLC