How much cover is right for you?
This table uses your numbers above to compare different amounts of cover.
| Cover | Target | Time to reach |
|---|---|---|
| Enter your numbers above to see this table. | ||
How to use this calculator
- Add up your essential personal costs for a month: the bills you'd still have to pay if work stopped.
- Add business costs you can't pause, such as insurance or software your clients rely on.
- Choose how many months of cover you want. Irregular income usually needs more than a salary does.
- Enter what you've saved and what you can add each month to see how long it will take.
How it's calculated
Worked example
Dana is a freelance photographer. Her essential personal costs are $3,000 a month and her business costs are $500. She wants 6 months of cover, has $5,000 saved and can put away $800 a month.
Dana needs $21,000 and will get there in 20 months. Her $5,000 already covers about six weeks without work.
Tip: don't count money you've set aside for tax as part of your emergency fund. That money already belongs to the tax authority.
Frequently asked questions
Why do freelancers need a bigger emergency fund?
Freelance income goes up and down, clients can pay late or disappear, and there's no sick pay or redundancy pay. A bigger fund lets you ride out quiet months without panic or debt.
Where should I keep my emergency fund?
Somewhere safe that you can reach within a few days, such as an easy-access savings account, kept separate from your everyday account so you're not tempted to spend it. It's not money to invest in anything that can fall in value.
Should I pay off debt or build an emergency fund first?
Many people build a small starter fund of a month or so first, so a surprise bill doesn't create new debt, then focus on expensive debt, then finish the full fund. A financial adviser can help with your situation.