Question #9 of GOBankingRates’ Top 100 Money Experts Series
How do I build an emergency fund that fits into my financial plan?
You can just picture it now: You’re cruising down the highway when suddenly your car starts making noises you definitely don’t want it to make. Or you’ve just gotten paid, and right as you sit to pay your bills, your cat chooses that exact moment to hork up a hairball concerning enough to warrant a trip to the emergency vet — and since he doesn’t have a job, he can’t exactly cover the cost. So, you get it: You need an emergency fund.
For You: 8 Smart Ways Frugal People Are Living Like There’s Already a Recession
Learn More: 3 Advanced Investing Moves Experts Use to Minimize Taxes and Help Boost Returns
But the thought of squirreling away extra cash while you’re trying to make ends meet — or even build real wealth — can feel like taking a match to your careful financial plans. Bola Sokunbi understands your concerns. As a certified financial education instructor and the founder of Clever Girl Finance, one of the largest personal finance platforms for women in the U.S., she knows how stressful it can be to develop a financial plan that works for you — including how to fit in an emergency fund.
Fortunately, she also knows how to sidestep those worries and create a realistic, sustainable strategy that lets you build for the future without neglecting life’s inevitable curveballs.
Figure Out the Amount You Actually Need
Instead of stressing about socking away a massive amount of money, Sokunbi wants you to focus on what’s realistic for your life. That starts with figuring out the right amount to keep in your emergency fund. This number depends on your lifestyle and fixed financial responsibilities. Sokunbi encourages you to think about essential recurring monthly expenses like rent or mortgage, utilities, transportation, and the minimum payments on any debt.
Once you have that number, aim to create an emergency fund with three to six months’ worth of those key expenses. If you’re self-employed or your income isn’t steady, Sokunbi recommends saving closer to six months’ worth to give yourself more breathing room.
“As for where to keep [your money], I always recommend a high-yield savings account,” she said. “It keeps your money safe, earns a bit of interest, and, most importantly, is easily accessible when life throws something unexpected your way.”
Read Next: Clever Ways To Save Money That Actually Work in 2025
You Don’t Have To Choose Between Financial Goals
Now, you might come away from doing that math with a sense of sticker shock over what three-to-six months of expenses adds up to. There go your plans to pay off debt, invest for the future, or finally boost your retirement contributions — right?
Sokunbi wants you to relax — don’t panic. She acknowledges that it’s common to feel torn between building an emergency fund and achieving other financial goals. Rest assured, though, you don’t have to pick just one — you can make steady progress across multiple fronts by starting small and shifting your focus over time.
“Start by putting a small buffer — $1,000 to $1,500 — in savings to cover small emergencies, while contributing a small amount of your income to retirement savings — for example, 5% of your income or at least enough to get any employer match,” she said. “Then shift some focus to paying down high-interest debt. After that, you can add to your emergency fund gradually while still contributing to long-term goals like retirement. It’s okay to rotate your focus — it’s all progress.”
This approach helps you avoid getting stuck in “either-or” thinking and allows you to approach your finances with a sense of balance. You don’t have to do everything at once — just keep moving forward.
Small Wins Now Can Mean Big Gains Later
If you’re already working with a tight budget or even starting from scratch, you can still build an emergency fund that doesn’t derail your other financial goals. Sokunbi recommends automating small transfers to keep you in the habit of adding to your fund. Even $5 or $10 a week adds up over time.
She’s also a fan of funneling extra money, like a tax refund, bonus or even a cash-back reward, straight into your emergency fund before you have a chance to think about spending it elsewhere.
Sokunbi advocates for mindfulness in money matters — you can stay motivated and continue making progress with small yet meaningful mindset tricks. “Naming the account something motivational like ‘Peace of Mind Fund’ can also help you stay committed,” she said. “It’s not about perfection — it’s about building a habit that sticks.”
Bottom Line
Having enough money set aside for emergencies is essential to any financial plan — not to mention your peace of mind. While you might worry that building your emergency fund will come at the expense (quite literally) of your other financial goals, Bola Sokunbi wants you to know it’s absolutely possible to do both.
With some small steps, smart habit-builders, and a little flexibility, you can protect yourself today while planning for tomorrow.
This article is part of GOBankingRates’ Top 100 Money Experts series, where we spotlight expert answers to the biggest financial questions Americans are asking. Got a question of your own? You could win $500 just for asking — learn more at GOBankingRates.com.
More From GoBankingRates
- Still Paying Off Debt the 'Smart' Way? Dave Ramsey Says That's Exactly Why You're Stuck
- The Real Reason Couples Fight About Money -- and How To Fix It, According to Rachel Cruze
- Are Memberships Worth It? This One Comes with More Than $1K in Annual Benefits
- 3 Advanced Investing Moves Experts Use to Minimize Taxes and Help Boost Returns
This article originally appeared on GOBankingRates.com: Bola Sokunbi: How To Build an Emergency Fund *Without* Blowing Up the Rest of Your Financial Plan
