Emergency fund: how much you really need
An emergency fund is money you do not plan to spend. It exists so that a layoff, a breakdown or a slow quarter does not push you into a loan. The question is not whether you need one. It is how much, where, and how to get there.
First, work out your real monthly spending
The fund is measured in months of expenses, not months of salary. If you earn €2,400 and spend €1,500, the number that matters is €1,500.
To get it right, add up what you pay no matter what every month: rent or mortgage, utilities, food, transport, insurance, your self-employed contribution if you have one, and the debts you already carry. Leave out what you would cut on day one if your income stopped, like leisure or travel.
That survival spending is usually 20 to 30% lower than your normal spending. In the €1,500 example, the minimum might be €1,200. That is the number you work with.
3, 6 or 12 months: which one is yours
There is no right figure for everyone. It depends on how stable your income is and how many people depend on you.
With €1,200 of minimum spending, the three scenarios give €3,600, €7,200 and €14,400. The gap between the first and the third is huge, so it is worth choosing deliberately rather than by default.
- 3 months: permanent contract, no children, low fixed costs and another income at home.
- 6 months: the most common case. One salary, some debt, dependants, or a sector where finding a job takes months.
- 12 months: self-employed with irregular income, one client worth more than 40% of your revenue, or a very specialised role.
Where to keep it
The fund has two requirements: available within 24 or 48 hours, and no sudden loss of value. That rules out stocks, crypto and investment funds. A bad month in the market cannot coincide with the month you need the money.
The usual choice is an interest-bearing savings account or a short-term deposit at a different bank from your current account. Physical separation matters: if the money sits in the same app you use to pay, it ends up spent.
Savings accounts in Spain pay between 1.5% and 3% a year in 2026 depending on the bank. With €7,200 in an account at 2%, you earn about €144 a year. It will not make you rich. It keeps inflation from eating the cushion.
How to fill it with irregular income
If you are self-employed, the advice to set aside 10% of your salary is useless, because there is no salary. What works is a percentage rule applied to every payment.
Each time an invoice comes in, first separate the VAT and what you set aside for income tax. From what remains, a fixed percentage goes to the fund. 10% of a €1,000 net invoice is €100. In a year with €25,000 net, the fund grows by €2,500 without you noticing.
The good months do the work. If one month you collect twice as much, the fund gets twice as much. When a bad month arrives, the fund covers the gap and you top it up when money comes back in.
How long it will take
With the target clear, the rest is a division. If you are €6,000 short and put aside €300 a month, it takes 20 months. At €500, twelve.
You do not need to go for six months in one push. A first target of €1,000 already covers most household surprises: a washing machine, a tyre, a dentist bill. From there, one month of expenses, then the rest.
And when you use the fund, which is what it is for, record it as what it is. It is not a failure. It is the reason you had it.
Frequently asked questions
Does the emergency fund count as savings?
It counts as net worth, but not as savings for goals. It is money reserved for surprises, so it should not appear in the trip goal or the house deposit.
Do I have to rebuild it every time I use it?
Yes. When you draw on it, the next priority is topping it back up before investing or saving for other goals again.
Can I keep it in a money market fund?
A money market fund is liquid and low risk, but takes a day or two to settle and can have small swings. Many people use it for the part of the fund they do not need within 48 hours.