Here’s How Much Americans’ Emergency Funds Are Shrinking

Core Insights - Emergency funds in the U.S. are significantly decreasing, with the median fund dropping to $500 in 2025, which is $100 less than the previous year [3] - A concerning 32% of Americans do not have an emergency fund, and about one-third cannot afford an emergency expense over $400 [3] - Research indicates that having a minimum of $2,000 in emergency savings can greatly enhance well-being and reduce stress levels [4] Emergency Fund Trends - The decline in emergency funds highlights a broader financial vulnerability among Americans, exacerbated by factors such as unemployment and rising prices [6] - Higher-income households are generally better positioned to save, while lower-income individuals face more challenges in building emergency funds due to external pressures like inflation [5] Strategies for Building Emergency Funds - Small, consistent savings can lead to significant improvements in financial stability; starting with as little as $10 or $20 can accumulate over time [7] - A review of spending habits can identify unnecessary expenses, allowing individuals to redirect funds towards building an emergency fund [8]