INDIANAPOLIS — An emergency fund is intended to cover your expenses for a length of time. Expenses can include your rent or mortgage, a car payment, and utilities.
Greg McBridge, with Bankrate, said according to their survey, 60% of Americans feel they are behind on their emergency savings.
"Emergency savings has long been the Achilles' heel of Americans' personal financial security, and that continues to be the case," McBride said.
In addition, 81% of Americans said they did not increase their emergency savings this year.
Reasons for the slow or lack of progress include inflation and high household expenses.
"More troubling is that 32% actually have less emergency savings today than they did at the beginning of the year," McBride said.
While six months' worth of expenses is ideal, the goal is to start somewhere.
"People often get freaked out by the destination or the recommended amount for an emergency savings account," McBride said. "But the fact is, it takes time, it often takes years to get there, in part because what you need to cover expenses is itself a moving target."
Before you get bogged down by numbers, McBride said to ask yourself, are you on the saving journey in the first place?
"It's that habit of regular and consistent saving, it's ultimately going to get you to that goal," McBride said.
For example, if you earn a regular paycheck, add your savings account to your direct deposit and send a portion of your earnings there — because money out of sight is money out of mind.