Emergency Fund Calculator India 2026
Calculate how much emergency fund you need based on your expenses, job type, and family situation. Get personalized recommendations for 3, 6, or 12 months of expenses.
Your Financial Details
Total monthly expenses including rent, groceries, bills, EMIs
Your job stability affects emergency fund size
Children, parents, or others financially dependent on you
Money you already have set aside for emergencies
How much you can save each month for emergency fund
Tip: Emergency fund should be kept in liquid, easily accessible investments like savings account, liquid funds, or short-term FDs.
Recommended Emergency Fund
₹0
6 months of expenses for your situation
Your Progress
Expense Breakdown (6 months)
Monthly Action Plan
Save ₹15,000 every month
Set up automatic transfer to a separate savings account
Keep in liquid instruments
Liquid funds (7-8% returns), Savings account (3-4%), or FD with premature withdrawal
Review quarterly
Adjust if expenses or income changes significantly
Where to Keep Your Emergency Fund?
Savings Account
Returns: 3-4% per year
Best for: Instant access, zero risk. Keep 1-2 months here.
Liquid Mutual Funds
Returns: 6-8% per year
Best for: Higher returns, 1-2 day withdrawal. Keep 3-4 months here.
Fixed Deposits
Returns: 5-7% per year
Best for: Safe, allow premature withdrawal. Keep 2-3 months here.
Debt Mutual Funds
Returns: 7-9% per year
Best for: Tax efficient after 3 years. Keep remaining amount here.
Pro Tip: Split your emergency fund across 2-3 options. Keep 1 month in savings account for instant access, 3-4 months in liquid funds for good returns + quick access, and rest in FD or debt funds.
Understanding Emergency Fund
Why You Need an Emergency Fund?
An emergency fund is money set aside to cover unexpected expenses or financial emergencies. It acts as a financial safety net that prevents you from going into debt when life throws curveballs.
3 vs 6 vs 12 Months - Which is Right for You?
- 3 Months: Dual income household with stable jobs, no dependents, good health insurance
- 6 Months: Single income household or salaried with 1-2 dependents (recommended for most people)
- 9 Months: Single income household with multiple dependents or unstable job market
- 12 Months: Self-employed, freelancers, commission-based income, or high job uncertainty
What Counts as an Emergency?
✅ TRUE Emergencies
- • Job loss or salary cut
- • Medical emergencies
- • Major home/car repairs
- • Urgent family matters
- • Natural disasters
❌ NOT Emergencies
- • Vacations or travel
- • Shopping sales
- • New gadgets
- • Wedding expenses
- • Planned purchases
How to Build Emergency Fund Quickly?
- Start small: Even ₹5,000/month adds up to ₹60,000 in a year
- Automate savings: Set up automatic transfer on salary day
- Use windfalls: Bonus, tax refund, or gift money goes straight to emergency fund
- Cut unnecessary expenses: Reduce subscriptions, dining out, or shopping
- Increase income: Freelancing, side hustle, or selling unused items
Common Mistakes to Avoid
- Investing in stocks: Emergency fund needs stability, not growth. Avoid equity
- Locked-in FDs: Don't put entire fund in FDs that penalize withdrawals heavily
- Not separating accounts: Keep emergency fund in separate account to avoid temptation
- Stopping too early: Build full 6 months before increasing other investments
- Using for non-emergencies: Be strict about what qualifies as emergency
Frequently Asked Questions
1. How much emergency fund for ₹50,000 salary?
If your monthly expenses are ₹40,000, you need ₹2.4 lakh (6 months) for salaried job or ₹4.8 lakh (12 months) if self-employed. Don't base it on salary, base it on actual expenses.
2. Should I invest my emergency fund?
No stocks or equity mutual funds. Keep in liquid funds, savings account, or FDs. You need safety and quick access, not high returns. 6-8% returns from liquid funds is good enough.
3. Emergency fund before investing in SIP?
Yes! Build at least 3 months emergency fund before starting SIP. You can build remaining emergency fund parallel to SIP, but have some buffer first to avoid breaking SIP during emergencies.
4. Should I include EMIs in emergency fund calculation?
Yes! Your emergency fund should cover ALL monthly expenses including home loan EMI, car loan EMI, credit card bills, and insurance premiums. You can't skip these during emergency.
5. What if I never have emergencies?
That's great! But keep the fund anyway. It gives peace of mind and financial security. Once you have 6-12 months saved, you can focus on wealth-building investments. Don't use absence of emergency to skip building the fund.
6. Can I use credit card as emergency fund?
No! Credit card charges 36-42% annual interest. It's the most expensive emergency option. Credit card can be backup for immediate access, but you should repay from actual emergency fund within a week.
7. How often should I review my emergency fund?
Review every 6 months or when major life changes happen (marriage, child, new EMI, job change). If your expenses increase by 20%, increase emergency fund proportionally.
8. What if I use emergency fund? Should I rebuild it?
Yes, immediately! Pause or reduce your SIP/investments and prioritize rebuilding emergency fund back to 6 months. Once restored, resume normal investment plan. Never leave it depleted.
9. Is ₹5 lakh emergency fund enough for everyone?
No! It depends on YOUR monthly expenses. If you spend ₹30,000/month, ₹1.8 lakh (6 months) is enough. If you spend ₹1 lakh/month, you need ₹6 lakh. Calculate based on your lifestyle, not fixed amounts.
10. Should I keep emergency fund separate from savings account?
Yes! Open a separate savings account or sweep-in FD for emergency fund. This prevents accidental spending and makes tracking easier. Name it "Emergency Fund" to remind yourself of its purpose.