# Emergency Fund Planner > Sizes an emergency fund from essential expenses and household risk tier, picks the right account, and builds the funding and replenishment schedule. Use when someone asks "how much should I have in savings", "how big should my emergency fund be", "where should I keep my emergency fund", or "should I save or pay off debt first". Do NOT use for sequencing debt payoff itself - use debt-payoff-planner instead; for planned irregular expenses like car registration or gifts, those are sinking funds - use budget-builder; for the full save-vs-invest ordering - use financial-planner. - Skill: `skillmedev/emergency-fund-planner` (Agent Skill) - Install (CLI): `npx skillmds@latest add skillmedev/emergency-fund-planner` - Raw SKILL.md: https://api.skillmd.com/api/skills/skillmedev/emergency-fund-planner/raw - Safety review: pending - Works with: Claude Code, Claude.ai, OpenAI Codex - Category: Finance & Business - Author: SkillMedev (https://skillmd.com/u/skillmedev) - Updated: 2026-09-17 - Page: https://skillmd.com/skills/skillmedev/emergency-fund-planner --- # Emergency Fund Planner An emergency fund is not a savings account - it is insurance against being forced into high-interest debt during a crisis. The costly mistake this skill prevents is the unsized fund: either so small the first real emergency lands on a 24% APR card, or so large that years of surplus sit in cash while high-interest debt compounds. Size it to the household's actual risk, place it where it is liquid but not frictionless, and schedule both the build and the refill. ## Operating procedure ### Step 1: Gather inputs Label guesses as guesses; refine from statements. 1. Essential monthly expenses only - the costs that cannot be paused: rent or mortgage, utilities, groceries, minimum debt payments, insurance premiums, transportation. Not total spending; a fund sized on total spending overshoots by 30-40% because discretionary spending stops in a crisis. 2. Household income structure: one earner or two, W-2 or variable/freelance, and how specialized the field is (proxy: realistic months to replace the job). 3. Current liquid savings and account type. 4. Any debt above 7-8% APR (changes the build order in Step 3). 5. Known risk amplifiers: health conditions, old car or house, dependents. ### Step 2: Size the target by risk tier The base is 3-6 months of essential expenses. Pick the tier, then add one month per significant risk amplifier: - Stable two-income household: **3 months** - the odds of both incomes stopping at once are low. - Single income, stable employment: **4-5 months**. - Single income, variable or freelance: **6 months minimum** - the fund also smooths income gaps between clients. - Single income, specialized field with long job-search timelines, or notable health risk: **6-9 months**. State the target as a dollar figure: tier months × essential monthly expenses. ### Step 3: Set the build order against debt - First milestone: a **starter fund of 1 month of essential expenses**, before aggressive debt payoff. Without it, every surprise re-creates debt. - Then pay down high-interest debt (above 7-8% APR) while holding the starter fund - route sequencing to debt-payoff-planner. No insured savings vehicle outpaces a 20% card. - After high-interest debt clears, resume funding to the full tier target. - Debt below ~7% APR does not pause the fund build; run both. ### Step 4: Place the money Requirements: liquid within 1-2 business days, principal-safe, and one deliberate step away from daily spending. - Default: a high-yield savings account at a federally insured institution, in a separate bank from the checking account. Yield should roughly match inflation; chasing an extra 0.3% is not worth losing FDIC/NCUA insurance or same-week access. - Not the stock market, not a CD with penalties - a crisis and a drawdown arrive together often enough to disqualify market exposure. - Not the everyday checking account - frictionless access causes quiet erosion from non-emergencies. ### Step 5: Schedule the build and define "emergency" Monthly contribution = (target − current savings) ÷ months to target; set it as an automatic transfer on payday. If the resulting timeline exceeds ~24 months, fund the starter month first, then revisit the budget (budget-builder) rather than accepting a 4-year build. An emergency is an unplanned, necessary expense: job loss, medical event, major car repair, emergency home repair. It is not a vacation, a sale, or a predictable irregular cost - car registration, holiday gifts, and annual premiums belong in sinking funds (budget-builder), which exist precisely to protect this fund. ### Step 6: Replenishment protocol After any withdrawal, replenishment becomes the top priority above all discretionary savings - treat it as a debt owed to future stability. Restart the automatic transfer at the fastest sustainable rate and pause extra (not minimum) debt payments until the starter month is restored. ## Worked example Single freelance designer, essential expenses $3,400/mo (rent $1,700, utilities $160, groceries $450, insurance $390, debt minimums $340, transport $360). Tier: single variable income → 6 months minimum; add one month for a 12-year-old car → **7 months = $23,800**. Current savings $2,000 in checking; card debt at 21%. Plan: move the $2,000 to a new HYSA today; build the starter month ($3,400 − $2,000 = $1,400 → $700/mo for 2 months); then throw surplus at the 21% card via debt-payoff-planner while holding $3,400; after the card clears, $850/mo automatic transfer reaches $23,800 in ~24 months. Withdrawal rule written on the account: "job gap, medical, car, home - nothing else." ## Deliverable Produce a one-page fund plan containing: essential-expense tally by category, the tier chosen with its justification, the dollar target, the account placement, the monthly automatic transfer amount with milestone dates (starter month by ___, full target by ___), the written emergency definition, and the replenishment rule. ## Do NOT - Do not size the fund on total spending; essentials only. - Do not fully fund 6 months while a 20%+ APR balance compounds - starter month, then debt, then full fund. - Do not put the fund in equities or penalty CDs; liquidity failure at the moment of need is the one unacceptable outcome. - Do not co-mingle it with checking or with sinking funds; each leak looks harmless and empties the fund. - Do not treat a withdrawal as failure - that is the fund working; the failure is not refilling it. ## Quality bar - The target cites a tier and shows the multiplication (months × essential expenses). - Risk amplifiers the user mentioned are reflected in the tier, not ignored. - The build order accounts for any debt above 7-8% APR. - The plan names an account type, a transfer amount, and two dated milestones. - The emergency definition and replenishment rule appear verbatim in the deliverable. ## Escalation This is general financial education, not individualized financial advice. For very high fixed expenses, significant health exposure, or income that swings widely month to month, recommend a certified financial planner to model fund size within the whole plan; route the broader ordering of priorities to financial-planner.