Build Your Safety Net with Emergency Fund Calculator

Disclaimer: This is an estimate based on simplified assumptions. Actual savings needs and growth may vary.

Our Emergency Fund Calculator helps you determine how much you need to set aside for unexpected expenses. Enter your details to estimate your target fund and see potential growth if invested.

How to Use the Emergency Fund Calculator

1. Enter your monthly expenses (e.g., $3,000) to estimate your living costs.
2. Input the number of months you want to cover (e.g., 6 for 6 months).
3. Specify the annual interest rate (e.g., 2%) for a savings account or investment.
4. Click Calculate Emergency Fund to view your target fund and growth chart.

The Logic Behind It

The calculator determines the emergency fund size using:
Emergency Fund = Monthly Expenses × Number of Months
To show potential growth, it uses the compound interest formula:
FV = P × (1 + r/n)^(nt)
Where:
- FV = Future Value of the fund
- P = Emergency Fund Amount
- r = Annual Interest Rate (as a decimal)
- n = Number of times interest is compounded per year (12 for monthly)
- t = Time in years (charted over 5 years)
This projects how your fund could grow if kept in an interest-bearing account.

Benefits of Using the Emergency Fund Calculator

• Clarity: Know exactly how much to save for emergencies.
• Planning: Set a realistic goal for your financial safety net.
• Security: Prepare for unexpected events like job loss or medical costs.
• Growth Insight: Visualize potential interest earnings on your fund.