Emergency fund calculator
Tell us how much you spend each month, and see how large your emergency fund should be and how long it will take to reach it.
Updated
Melvi suggests an emergency fund of $12,600
3 months of fixed bills and day-to-day spending, because your salary is fixed.
$9,600 to go. Saving $600 a month, you get there in 16 months.
If you pay interest on a credit card balance or an overdraft, pay off that debt before you grow past a small fund.
Start for freeIn the free quiz, Melvi does this math with your whole month. With a subscription, it tracks your fund with your accounts.
What an emergency fund is
It is money set aside for an emergency, such as losing your income, getting sick, or an urgent repair at home or on your car. With it, you get through a tight spot without taking out a loan or using your card limit.
Why 3 or 6 months
Melvi suggests 3 months of essential expenses for people with a fixed salary, such as CLT employees (Brazil's formal employment regime), public servants, or retirees. It suggests 6 months for people whose income varies, such as freelancers, PJ contractors (registered as a company), commission earners, or people with side jobs. Anyone who doesn't know how much will come in next month needs more of a cushion.
It is a suggestion, not a rule. You may want more or less, and in the app you can change the goal whenever you want.
Which expenses are counted
Only the expenses you can't cut overnight: fixed bills, such as rent, building fees, power, internet, and school tuition, plus day-to-day costs, such as groceries, transportation, and health. Leisure, shopping, and subscriptions are left out, because in a tight spot they are the first to go.
How to build the fund little by little
- Set aside a fixed amount as soon as money comes in, before you pay the rest of the month.
- Start with the emergency fund, and only then move on to your other goals, as Melvi does in the app.
- If the month gets tight, save less, but don't stop, because the habit counts for more than the amount.
What if I have card debt or an overdraft?
Paying off high-interest debt comes before building a fund beyond a small starting amount. Interest on revolving credit and on an overdraft grows faster than your savings, so paying off the debt saves more than your savings would earn.
Where to keep the fund
Keep it in a place separate from your day-to-day account, so you don't spend it without noticing, and where you can withdraw the money the same day. Melvi does not recommend any product or institution, and the choice is yours.