Snowballr · Cheat sheet
Emergency fund cheat sheet
How much, where to keep it, and when to spend it.
For: Anyone building first savings · Source: snowballr.io/cheat-sheets/emergency-fund
Sizing — months of essentials (not full income)
| Situation | Target |
|---|---|
| Single, stable W-2 job, low-cost area | 3 months |
| Two-income household, stable jobs | 3 months combined |
| Single-income household, kids | 6 months |
| Self-employed / commission / freelance | 6–12 months |
| Health condition or high-deductible plan | +1–2 extra months |
| Major life change incoming (move, baby) | +1 extra month |
What counts as essentials
- Housing (rent/mortgage, insurance, property tax)
- Utilities (electric, water, internet, phone)
- Groceries (not restaurant)
- Minimum debt payments
- Transportation (gas, insurance, basic maintenance)
- Health insurance premium + median copays
Where to keep it
- High-yield savings account (HYSA) — 4–5% APY, FDIC insured, instant access
- Money market fund — comparable yields, brokerage-housed
- NOT in stocks — you need the money when market is also down
- NOT in CDs — 6-month CD ladder OK for the second half of fund
What is an emergency
- YES: job loss, unexpected medical, major car repair, urgent home repair
- NO: vacation, holiday gifts, planned home upgrade, "good deal"
Decision rules
- Build $1K starter fund first → kill any APR >10% → then top up to 3–6 months.
- Replenish within 6 months of any use; otherwise something else is broken.
- Review target annually as expenses change.
- Joint and solo households should each maintain separate access in case of one freezing.