15 Things People with a Hefty Emergency Fund Do (And How to Copy Them)

An emergency fund — which is a savings account that includes enough money to cover between three and six months’ worth of expenses — is a key part of a healthy financial situation. 

Without an emergency fund, a single unexpected expense could derail your finances. Since no one knows what life might throw their way, it’s important to prepare yourself financially.

When it comes to setting yourself up with an emergency fund, it’s important to consider what those who have hefty funds have done so that you can be successful in your efforts. Keep reading to learn more about those good habits that can help you save.

Saving without a goal could lead you to stockpile more (or worse, less) than you need to have on hand. Those who have a solid emergency fund do so by first determining how much they’ll actually need to stay afloat for a few months without income.

For example, if someone spends $2,000 per month, experts might recommend they store between $6,000 to $12,000 in an emergency fund.

Additionally, the exact amount varies based on a person’s risk tolerance. If you are comfortable with more risk, three months’ worth of expenses might be sufficient. But if you aren’t comfortable with risk, stockpiling 12 months’ worth of expenses might better suit your needs.

People who have large emergency funds can make that money work for them but putting the money into a high-yield savings account, where it will have the ability to continue to grow until they need it.

As you build your emergency savings, it’s important to be intentional about where you decide to tuck those funds, and to take into consideration things like how quickly you’ll be able to access the money when you actually need it.

Having an emergency fund can feel like a huge safety net. But, that backup plan only works if it’s there when you need it, so those with a large amount of funds on hand keep their money safe by not treating it like their own private piggy bank.

When possible, separate your emergency fund into a separate account from your regular savings account. Otherwise, you may find it too easy to accidentally spend your emergency savings on non-emergency expenses.

Those with big emergency funds know that relying on other accounts — for example, a 401(k) or CD — isn’t the same as setting money aside for a rainy day, and they don’t stop saving just because they know that they can access money by cashing in on their other long-term savings plans in a pinch.

As with all financial goals, automating your savings can ensure your success. Some folks may find it easier to achieve their financial goals by automating the process. What does that look like? 

Typically, it means setting your bank account up so that a portion of every direct deposit goes into your emergency account.

Fortunately, it’s fairly straightforward to set up an automatic transfer from your paycheck into your emergency savings account. Over time, you’ll see your stockpile grow.

Although it is tempting to continue building an emergency fund forever, those with successful emergency funds consider that savings goal as just one step in their financial journey.

To follow in their footsteps, you’ll want to stop adding to your emergency savings when you hit your predetermined goal.

Once you top off your emergency fund, use the funds you were saving to supercharge other financial goals. For example, you might redirect those funds to save for a house down payment or invest for retirement.

Those with big safety nets will likely tell you that they don’t touch that money unless it’s a true emergency. Generally, emergencies involve losing your job, incurring an unavoidable expense, or becoming unable to work.

For example, getting into a car crash that leaves you unable to work for months would be the right time to lean on your emergency fund. 

On the other hand, using the funds to make a purchase because you want to have the item usually isn’t a good use of the funds.

A big thing that people with successful rainy day accounts due involves topping off their account when they have to tap it for a bit.

That means making it a priority to rebuild your savings back up after you use some of the money to do something like deal with a medical emergency.

Irregular expenses might feel like an emergency. But they aren’t to those who have a clear definition of what they will and won’t access their fund for.

For example, paying your auto insurance once a year or replacing your tires might feel like an emergency, but in reality, these are irregular expenses that you can plan for. 

Instead of pulling from your emergency account, you can take a look at the upcoming year to estimate irregular expenses on the horizon. Make a plan to save for these costs instead of leaning on your emergency fund.

Although an emergency fund can help you pay for emergencies, having the right insurance policies in place can help you pay for those expenses instead.

For example, a travel insurance policy might help you pay for a medical emergency abroad, which would help you preserve your emergency fund.

When they receive unexpected funds, instead of splurging, those with robust emergency savings accounts use the funds to build up their account before spending the money on other financial goals.

For you, that may mean taking that unexpected tax refunding and putting it directly into your rainy day account.

It can take months or years to build up a substantial emergency fund. Celebrating along the way can not only make it more fun to hit those goals, but it can also help reinforce their importance.

Sticking to a savings habit can lead to long-term rewards, and small celebrations might keep you motivated along the way.

Chances are, not everyone with a hefty emergency fund started out with a ton of money in the bank. Instead, they started slowly, adding a little bit to it whenever they could.

When you start your financial journey, you might not have too much room in your budget for savings. Instead of waiting to save until later, make an effort to start saving any amount. Even if you are setting aside a small amount of funds, these can add up over time.

Chances are, if you asked someone with a lot of money in the bank how much they have set aside, they’ll be able to tell you the amount down to the penny.

Checking in on your savings can help you stick to the plan. Generally, checking in on your progress every month or so is a great place to start. For some, tracking progress on a spreadsheet or in a notebook can make progress feel recognized.

Impulse buys can spell disaster for any savings goal. Instead of giving into every whim to make a purchase, those with a robust savings account typically take a step back and consider why they are saving before making impulse buys.

Thinking about the comfort a long-term emergency fund could provide might encourage you to skip an unnecessary purchase or two.

As you build wealth, an emergency fund offers a security blanket to fall back on. Making this a financial priority can come in handy when you face truly unexpected expenses.

But, when it comes to ensuring that your savings plan is a success, it can be important — and sometimes inspiring — to see how other people are getting it done.