**3-to-6 months’ expenses, saved for emergencies.** An Emergence Fund is a fairly liquid chunk of assets (e.g. Savings Account) that can be called upon to cover you in the case of emergencies (car breaks down, AC goes out, break a leg). The size of your emergency fund is based on your [[Burn Rate]]. Most sources I’ve read peg a good emergency fund goal at between 3 and 6 months’ living expenses. That is - enough to cover your absolute necessities. This is not _necessarily_ equal to your burn rate, or even your [[Budget]], but what those things could be reasonably brought down to without sacrificing too much. Basically you don’t need to include your monthly $200 donation to whatever charity in your emergency fund… just stop making that donation in the case of an emergency. **** # More ## Source - [[Your Money or Your Life]] - [[Budget Boot Camp]] - [Reddit - Dive into anything](https://www.reddit.com/r/personalfinance/wiki/commontopics) ## Related - [[Burn Rate]] - [[Budget]]