How far will our $25,000 stretch?
Right now, my household spends about $6,000 to $7,000 per month. So if something major happened, like if I was to lose my job (let’s be honest AI will probably replace me any day now), our HYSA would cover three to four months of normal living expenses.
That’s decent, and most financial pros recommend saving three to six months’ worth of essential expenses. So we’re in the ballpark — at the lower end.
But here’s where it gets interesting…
A lower-spending lifestyle gives us more runway
If a true emergency did actually happen, my wife and I would probably cut back our spending. Hard.
If we cut out travel and impulse buys, and also cut out the higher-end groceries we’ve been splurging on, we could survive on much less I think.
Just survival-mode spending would be about $4,500 per month.
With this smaller budget, our $25,000 could last more than five months. I already feel a lot safer knowing we have this flexibility.
Should we keep more in our HYSA?
Thinking about my friend’s ~$100,000 cash cushion, that might fit her better because of her situation and lifestyle. Emergency savings aren’t a one-size-fits-all thing.
Having an even bigger emergency fund really depends on things like:
How stable is your income? Freelancers or single earners might want six to 12 months saved.How fast could you cut expenses? If you’ve got wiggle room, you may not need as much.What are you protecting against? Job loss? Medical stuff? You might have different risks (or safety nets) than other people.Do you have backup plans? Like a spouse’s income, side hustle, or investment cushion?
For us, I feel like $25,000 is a solid middle ground. It gives us breathing room without keeping too much in cash.
If we ever dip into it, we know how to rebuild. But in the meantime, it’s growing quietly — thanks to that sweet APY.
The bottom line
There’s no universal “right” number to keep in an HYSA. But it’s worth checking in once in a while to make sure you feel good about what it can cover in an emergency.
And no matter what your savings balance is, I believe it should definitely be earning you something, not just sitting there.
If your HYSA isn’t pulling its weight, or if you’re not sure how much to stash, now’s a great time to reassess. Earn up to 4.40% APY with one of these top savings accounts, and make your emergency fund work harder.