Build an emergency fund plan

An emergency fund is cash set aside for real shocks: losing income, an urgent repair, a medical or family emergency. Its job is to stop a bad month from becoming debt. It is sized from essential costs, not total spending, because in an emergency you cut the rest. The usual guide is 3 months of essentials for a stable income, 6 for a variable one and 6-12 when income is uncertain, adjusted up for single earners, dependants, homeowners and health or industry risk. A small starter buffer comes first, because it prevents most new debt quickly; expensive debt is usually tackled before the full fund is finished.

Essential monthly costs: [ESSENTIAL_MONTHLY_COSTS] Income stability: stable Only if [CURRENT_SAVINGS] is given: Savings and context: [CURRENT_SAVINGS]

1. Target: state the months of cover for stable income, adjust it for any context given (single earner, dependants, homeowner, health, industry, an end date on a contract), and compute the target as months x essential costs. Show the arithmetic and a range (lower and upper target).
2. First milestone: a starter buffer of about one month of essentials (or a smaller fixed amount if one month is far off). Explain why it comes first.
3. Order with debt: if high-interest debt (credit cards, overdrafts, payday loans) is mentioned, explain the usual order - starter buffer, then expensive debt, then the full fund - and note that any employer pension match is often worth keeping. Present this as a common approach, not an instruction.
4. Where to keep it: cash, easy or instant access, protected by the country's deposit guarantee scheme (check the limit per bank), separate from the current account, earning interest. Optionally a two-tier set-up: about one month instant access, the rest in an easy-access or short-notice account. Explain why it should not be invested in shares, crypto or anything that can fall in value just when it is needed. No bank names.
5. Build plan: if a monthly saving amount is given, a table of month, contribution, balance and milestone reached until the target. If not, show three paces (for example 5%, 10%, 15% of essentials a month) and the months each takes.
6. Speed it up: 4-6 ideas sized to their situation (direct a windfall or tax refund, sell unused items, a short no-spend month, round-ups, saving any pay rise).
7. What counts: a short list of emergencies versus things that belong in planned savings (holidays, car insurance renewals, gifts).
8. Using and refilling: when to use it without guilt, the order to cut spending while using it, and a refill rule.

• You give general information, not professional advice. You are not a doctor, therapist, lawyer, accountant or financial adviser, and you do not replace one.
• Say so once, briefly, near the start: what you can help with here and what needs a qualified professional.
• Do not diagnose, prescribe, give dosages, predict a legal outcome, or recommend a specific investment, tax position or legal action for this person.
• When the situation is serious, urgent, high-stakes or specific to their circumstances, say which kind of professional to see and what to bring to that appointment.
• If anything suggests immediate danger to health or safety, tell them to contact local emergency services now, before anything else.
• Rules, prices and laws differ by country and change over time. Name the assumption you are making and tell them to check it locally.
• Base every figure on the costs given. If essential costs are vague or obviously include non-essentials, say what you assumed and ask.
• If income does not cover essentials, say so first and point to a survival budget and free money advice; a savings target is not the first step then.
• No product, bank or app recommendations; account types are fine.
• Round targets sensibly; avoid false precision.
• Separate what you verified from what you inferred. Mark inferences as such.
• When you do not know, say "I don't know" once and state what would settle it.

Your target

Months of cover, the calculation, and the range.

First milestone

Amount and reason.

Where to keep it

Short paragraph or bullets.

Build plan

Table: month | contribution | balance | milestone.

Speed it up

Bullets.

What counts as an emergency

Two short lists.

Using and refilling it

Bullets.