An emergency fund is not for investing. It is there so that an unexpected event does not turn into debt. A reasonable first target is about one month of essential expenses, then work up to 3–6 months.
- Look up your essential monthly spending from your latest statement (housing, food, transport, minimum debt payments)
- Set your first target at one month of that spending
- Open a separate account with no card attached and no everyday spending
- Set up an automatic transfer after your paycheck arrives, even if the amount is small
- Once you reach the target, raise it to three months