Emergency Fund Examples: 23 (Unexpected) Reasons Why You Need One

Who needs an emergency fund? You do! These 23 emergency fund examples are here to get you thinking about why you need to save money.

You know you do, but still, you don’t have one. So this post is for you. Read it carefully and understand what an emergency fund does for you.

A key part of getting to grips with your finances is having money put aside for unforeseen events.

Having an emergency fund, a pot of money you can dip into in a crisis, is a financial goal you should aim to achieve. But not everyone sees the priority to do so.

These emergency fund examples are solid reasons to get your fund up and running now, if you haven’t already done so.

So what constitutes an emergency to justify dipping into your precious savings?

red piggy bank with train of coins to a house (emergency fund examples)

Examples Of why you need An Emergency Fund strategy

A friend of mine recently had a stroke of bad luck. Her husband is self employed. If he doesn’t work, he doesn’t get paid nor is he entitled to any sick pay.

Like many men he still loves to play football (soccer) despite his somewhat more mature years!

You guessed it, he damaged his knee playing football one evening, resulting in the doctor saying he needed 4 weeks off work.

I was so happy when my friend said they had a 12 month emergency fund. So many people don’t and I had feared the worst. Having the security of those emergency savings meant they weren’t worrying about money during those 4 weeks.

And more importantly, he didn’t go back to work too soon due to money issues and cause himself further, long term damage.

This is just one of many reasons why you need an emergency fund even if both of you are working. So many families these days rely on 2 incomes to make ends meet.

If they suddenly found themselves with unexpected espenses or having to live on one income the family are in real trouble.

Emergency savings, living below your means and being frugal are ways you can insure yourself against having an emergency that cause financial trouble and gives yourself peace of mind.

What qualifies as an emergency for emergency fund?

An emergency is something you had no way of forseeing would happen, something unexpected. So general car repairs would not qualify as an emergency. Whereas having your car stolen would!

Is a $1000 emergency fund enough?

It’s a great starter emergency fund. But let’s be realistic, one major car repair would wipe that out. $1000 is enough to get started with but don’t stop there.

What is a good emergency fund?

A good emergency fund is one that can cover your essential expenses for 3-6 month,s maybe even longer. Essential expenses aren’t your usual living expenses. Because when emergencies happen you won’t be spending normally. You’ll be holding onto every penny for as long as possible

What expenses are included in an emergency fund?

The reasons you need an emergency fund are all about unexpected expenses. That’s what you need for plan for. Because these expenses are unexpected you don’t know how much they would be or when they will happen. That’s why you need a good amount of money saved too

How do I get emergency money?

You need to save your cash cushion into a separate savings account, not your regular bank checking account. It needs to be separate but immediately accessible. Don’t put it in the stock market or a limited access account. An emergency calls for immediate cash availability.

23 Examples Of When You Need Your Emergency Funds

I really hope you already have money set aside for a rainy day but just in case you haven’t quite got around to it yet here are 23 examples of when your emergency fund will save your bacon.

Emergency Fund Examples At Work

Job loss

You may think you have the safest job in the world but do you want to bet your family finances on it? Some people lose their job overnight, without warning.

It can take months to get a new job and your emergency cash will see you through the job gap.

I worked for the UK Civil Service – the safest job you could have, right? Wrong! A colleague transferred into our department only to be told that the location he had transferred to was closing down within 2 years.

Worse, he would be expected to travel 90 minutes into London after that if he wanted to keep his job. Instead of the 20 minute walk he had, dropping his child off at school along the way.

Job Relocation

See the example above! Companies and employers have a habit of upping sticks and moving location, or closing down branches and expecting staff to relocate.

If your company did this

a) they might not finance all the costs involved in moving, and

b) can you afford a house in the new location and what about your partner’s job, schools etc?

Losing Regular Overtime

For many people their base salary is not what they are used to receiving. Far from it. Compulsory and ongoing, regular overtime can bump up your salary very nicely.

What if your employer cut all overtime out overnight? Could you adjust your expenses downwards immediately?

piggy bank with glasses on surrounded by calculator, and paper charts

Unexpected Tax Bills

One of my blogging buddies recently wrote about an unexpected tax bill they got due to a one off bit of work they did. They got it covered but could you?

If you got a tax bill for $2,000 could you cover that and write a check for it without using your credit card or going into debt?

Retraining Costs

OK, not exactly one of the best reasons for building an emergency fund. If you hate your job or want to get a different, better job it takes money to retrain.

My husband got to a point in his carpentry career where he was very unhappy. He decided he had to do something different to keep sane. He dropped to a 3 day working week and retrained in environmental conservation.

We could afford to do this because we had emergency funds as a safety net. We didn’t want to use it all so our budget was very much reduced during this time.

We knew we would likely need extra money in an emergency whilst he was retraining as there was no spare money in our new, tight budget.

Unexpected Illness and medical emergencies

You might be the fittest person in the world so illness is not something you are used to. But you cannot take your health for granted, even with health insurance.

What if you were in car accident? Had one or more medical emergencies? Or diagnosed with cancer or a life changing health condition?

Could your emergency funds cope with you being off work for say six months or not being able to return to full time work?

couple holding hands near beach

Family And Relationship reasons for an emergency fund


Being pregnant, expected or unexpected, brings with it some costs. They may be minimal with costs limited to things like travelling to ante-natal appointments or maybe some test costs.

However not every pregnancy is straightforward and complications can mean extended time off work, unpaid.


According to The Street, it can cost up to $233,000 to raise a child to 17 in the US. And it’s up to £230,000 in the UK according to The Telegraph.

Whilst I would dispute those figures for most families on a modest income, there is no doubt that children cost money. Much of which you can and do absorb into your everyday budget.

But what if you were planning and banking on a return to work after maternity leave but you had twins? Could you afford childcare for 2 babies?

Or what about those children who get into all sorts of scrapes, ones which as parents you have to pay out to rectify?

Building an emergency fund is extremely useful and necessary when you’ve got children – believe me!

Ill Relatives

When a close family member falls ill you want to be able to drop everything and be there for them. Can you afford to do that and not reply on your credit cards?

family picture of man, woman and child (emergency fund examples)

Cheating Partner

Not something I would wish on anyone. But a relationship breakdown, especially one you didn’t see coming, can be very costly.

If you discover your spouse is cheating and that signals the end of your relationship, can you afford to separate?

A Secret Addiction

Many people have addictions, which, left unchecked or unresolved, can destroy marriages and finances.

If you or your spouse are addicted to gambling, drugs or alcohol, money will very quickly become a real problem.

Escaping An Abusive Partner

On average those living with an abusive partner will try to leave 7 times before they are able to successfully leave that relationship. Having a pot of money that you can use to fund that escape is therefore essential.

For further information and help:

In the UK contact Refuge

In the US contact The Hotline


You can never foresee when you will want to need to attend a funeral. Local events need not cost much but relatives don’t always live locally.

Last minute flights and accommodation always cost more than those planned months in advance. Your pot of cash will help you during these difficult times.

Pet Illness

Pets are family and so you will do whatever you need to do in order to make them well. Which can often mean a large vet’s bill.

One of our cat’s developed a terrible limp. The vet referred him to an orthopedic surgeon who diagnosed a dislocating knee – it kept dislocating and he was in a lot of pain.

He had to have immediate surgery, no time to get our insurance company to agree to make payments direct as this involved a 72 hour wait.

We had to stump up $4000 in the space of 48 hours! Our insurance did pay out eventually but it was 6 weeks later.

That’s the kind of emergency where you want to have readily accessible funds.

piggy bank, stacks of coins and a house

Emergency Fund Examples At Home

Rent Increase

Or a large mortgage increase if you own your own home. You don’t usually have the luxury of having fixed housing costs so rent increases can and do happen.

Having enough money set aside in your emergency savings to cover the increase until you can do something about it, like move or re-mortgage to a better rate, stops your budget from being blown.


Landlords can choose to evict their tenants for many reasons and doing the right thing morally isn’t part of the equation. You often only get 2 months notice of eviction.

Trying to find a new place to live that meets all your requirements is difficult and there are always extra costs involved.

Boiler Replacement

Planning to have your boiler replaced in time is one thing. Having it forced on you just as the weather turns really cold is another. Especially if it’s unexpected and you hadn’t planned for it.

New boilers and furnaces are a major expense, likely costing upwards of $4,000. Home repairs are required on a regular basis, no matter how new your house may be.

To cover the cost of home repairs it really does makes good financial sense to some money set aside in a savings account to cover them.

family of 4 walking along the beach shore line

Miscellaneous reasons you need Emergency savings

Stranded Abroad

Over the past few years there have been a number of airlines who have collapsed into administration.

The most recent one in the UK was Monarch Airline which left 100,000 customers stranded far away from home. If you are stranded abroad you need money to get back, no matter whose fault it is.

Identity Theft

You hear all the horror stories of people having their identity stolen and huge loans taken out in their names. It gets sorted, eventually, but in the meantime your access to credit may dry up and your bank accounts could be frozen.

Cyber Theft

We are in the process of buying a house at the moment and our solicitor has made it very clear cyber theft is a real problem in the financial world now.

Cyber theft often takes the form of criminals intercepting your emails and impersonating others.

I have seen reports of house buyers losing their entire deposit as criminals intercepted their solicitor emails and the buyers ended up transferring money to the wrong account.

Dropping Your Computer/Phone In Water

Thankfully not something I have done but I do know someone who has! When you rely on your laptop for your work or business then you need to replace it fast.

A Mac can set you back a pretty penny so having emergency cash in an instantly accessible savings account is very helpful.

1950s car on the road

Car Repairs

Cars are very reliable these days but when they go wrong, they can go horribly wrong. Car repairs can easily add up to the tune of $1,000 or more.

New Car Cost

If your car needs repairing but it’s not cost effective to pay out for them. You end up with an even bigger bill – a new (to you) car. These days you don’t get much reliability for less than $4,000.

How Much of an Emergency Cash cushion To Save

How much cash you save into your emergency fund will depend on a few things. Firstly, as a minimum I would encourage you to save at least $1,000/£1,000.

But that won’t get you very far in a real, long term or costly emergency. It won’t get you a new car. Or keep you going whilst you find another job.

In the ideal world you should aim to save between 3-6 months money. Now that’s not six months of your actual income.

More 3-6 months of your survival budget that you know you can survive on until you are earning again or the emergency expense is paid for.

When you hit an ongoing emergency like losing your job, you won’t carry on spending like you do when all is good. Nope you’ll be on that super tight budget you already had worked out just in case.

Here’s what my normal budget and super tight budget looked like a few years ago:

table of 2 different budgets

Our budgets have changed since then because we no longer have a mortgage.

Top Up Your Emergency savings Fund safety net

I hope with these 23 emergency fund examples that I have convinced you to either start saving into a separate pot or to top up the emergency funds you already have.

I know when you are living on a tight budget it can be hard to see those savings just sitting there.

But these examples show you just why you should leave the cash alone ready for when your own emergency happens.

I hope it never does.

Come and follow me on Pinterest for more money saving hints and frugal tips!

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Last Updated on 19th October 2021 by Emma

About Emma

I'm here to help you become confident in making the best money decisions for you and your family. Frugal living has changed my life, let me help you change yours.

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