How much money do you really need in an emergency fund – Telemundo Miami (51)

How much money do you have set aside for emergencies? If you’re like most Americans, the answer is “less than I’d like.”

According to a recent Bankrate survey, about 6 in 10 American adults say they are uncomfortable with their level of emergency savings.

On this front, many money experts would tend to agree with the public.

Financial planners generally recommend saving three to six months of living expenses in an emergency fund. More than half of Americans (56%) say they have less than three months of expenses saved, including 27% who say they have no emergency savings.

But when you consider what it would actually be like to save three months’ worth of expenses, you may be shooting too high if you base your calculations on your current monthly budget.

After all, if you had the kind of emergency that would require you to live off your cash reserves, items like your tennis lessons and monthly house cleaning would probably be off the table.

“When planning an emergency fund, it’s essential to strike a balance between ambition and practicality,” says Alyson Basso, a certified financial planner with Hayden Wealth Management in Middleton, Massachusetts.

While three to six months is a worthwhile goal, saving for it can feel daunting, she says. “What can make this more attainable (and ultimately more useful) is to think about saving for three months of essential expenses rather than the costs of your current lifestyle.”

Why you need emergency savings

When it comes to your financial priorities, establishing an emergency fund should be at the top of your list, which may seem counterintuitive. When I have so many goals, needs, and desires competing for my money, why put them in a place where I hope to never use them?

The point is that something will come up. And when it does, having an emergency fund prevents you from taking money away from your other financial goals.

“Think of an emergency fund as a buffer between you and high-cost debt or forced asset sales in the event of unplanned expenses or reduced income,” says Greg McBride, chief financial analyst at Bankrate.

In other words, if you need new tires, your dryer breaks down, or you get laid off, you won’t have to rack up a ton of credit card debt or cash in your 401(k) to stay afloat.

Be realistic about what you need to save

The guidelines recommended by financial planners are meant to put you in the right ballpark in case you’re faced with a major emergency, such as losing your job. But thinking about what three months of regular expenses look like can make you think you need more than you really do.

Focus on what you would need to get by, including housing, utilities, food, healthcare, and minimum payments on any debt. Eliminate many of your discretionary expenses to have a more accurate and accessible version of your emergency budget.

“If you normally spend $4,000 a month but estimate you could get by on $2,500 by cutting back on non-essentials, then your emergency fund for three months would be about $7,500 instead of $12,000,” Basso says. “This approach not only makes the goal less intimidating, but it also better aligns with the reality of how your spending would change in an emergency.”

The amount you need depends on your particular financial situation, including your job stability, marital status, and personal philosophy about money.

“There’s some psychology involved,” says Donnie LaGrange, CFP at Murphy & Sylvest Wealth Management in Dallas. “Some people want a bigger cushion or worry about it, while others are fine with being pretty lean and keeping it to the minimum.”

Generally, if you have a steady job, a high-earning spouse you can depend on for income and insurance, and other ways besides retirement savings to access cash, you can stick to the lower end of emergency savings ( maybe three months of savings stripped away) overdue expenses, he says. But a single-breadwinner family might lean more toward the equivalent of six months.

But even if you have a high income, it’s worth considering what your specific financial situation might look like in an emergency.

“We have a client who is a high-level attorney in a fairly specific niche,” LaGrange says. “He believes it would probably take him a year to find the right opportunity, so his [fondo de emergencia] “valid for one year.”

This article was originally published in English by Ryan Ermey for our sister network CNBC.com. For more from CNBC go here.