Now Reading: 3-6-9 rule: calculate your emergency fund savings goal
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3-6-9 rule: calculate your emergency fund savings goal
The 3-6-9 rule is a thumb rule for building an emergency fund, livemint.com reports. For a single person with steady income, save three months of expenses. If you have dependents but a…
The Story in Brief
The 3-6-9 rule is a thumb rule for building an emergency fund, livemint.com reports. For a single person with steady income, save three months of expenses. If you have dependents but a regular job, save six months. Freelancers or those with irregular income should save nine months, or 12 if they have dependents.
To calculate, list non-negotiable monthly costs such as rent, EMIs, school fees and groceries. Multiply by the required months. Start small, even Rs 500-1,000 a month, and automate deposits from bonuses or side income. Keep 30-40% in a savings account or fixed deposit for immediate access, and 60-70% in liquid or overnight mutual funds for slightly better returns.
The Indian Opinion
Financial influencers often present the 3-6-9 rule as a one-size-fits-all solution, but the article itself admits it is only a guideline. The real test is whether you actually start saving, even Rs 500 a month. The lazy narrative that an emergency fund is optional or that you can rely on credit cards ignores the peace of mind a dedicated corpus provides. Watch for the monthly automated deduction: if it is not set, the rule is just talk.
Source: livemint.com
This story was synthesised by AI from the source linked above.
