How Big Should Your Emergency Fund Actually Be?

Most advice tells you to save three to six months of expenses.

For a lot of Ontario households, that is either impossible or the wrong target.

Here is a more useful way to set it.

Start with the real number

Not your income. Your survival number.

Add up only what you must pay each month:

• Rent or mortgage
• Property tax and utilities
• Groceries
• Insurance and transportation
• Minimum debt payments
• Childcare

That figure, not your lifestyle spending, is the base.

Then adjust for your situation

✅ Two stable incomes, no dependants → closer to three months
✅ One income, or variable or commission income → closer to six
✅ Self-employed, or a household with dependants → six or more

Build it in stages

Chasing six months at once is how people give up in week three.

Stage 1: $1,000, fast.

Stage 2: one month of survival costs.

Stage 3: your full number.

Keep it boring and reachable

A separate high-interest savings account works.

Locked-in investments do not, because emergencies do not wait for a good market day.