How Many Months Is Enough? Emergency Fund Size Against the Duration of Income Interruptions

Advice on emergency funds is given in months — three to six is the standard range — without reference to what the months must survive. This paper prices the advice against a stated interruption process: essential spending of USD 2600 a month, interruptions arriving at 4% a month, lasting one to nine-plus months with the stated duration weights, and paying 30% of normal income while they last. A fund of three months of essentials is exhausted before income resumes in 21.8% of interruptions; four months reduces that to 7.0%; the smallest fund holding exhaustion under 5% is 7 months, and under 1% is 7 months. Since the stated onset rate implies a 99.2% chance of at least one interruption in a decade, the fund's size is not a remote contingency but the household's main insurance decision. The study is simulated, not measured. SIMULATED, NOT MEASURED.