You never know what life will throw your way. One minute you are financially stable and the next thing you know, you’re struggling to make ends meet. This is why it’s always important to have a cushion against these curveballs. 

It’s hard to imagine that as a public employee you may need an emergency fund, much less use money from one. However, the future is unpredictable which is why it’s prudent to have some money stacked away.  

A CalPATH home loan advisor could also equip you with great tips on how to save for the future. 

How big should your emergency fund be?

Financial experts recommend your emergency fund to have 3 -6 months of basic living expenses.1 These limits are however affected by several factors. For instance, if you are living in a two-income household, with both of you in steady jobs, a three-month fund is okay for you.

A six-month fund on the other hand would be a good idea where there is only one income stream for the family, or if one income is not steady.

Where should you keep your emergency fund?

There is a catch 22 when it comes to keeping emergency funds. On one hand, the funds should not be easy to access, since there’s a possibility you could be tempted to dip into them for non-emergencies. 

On the other hand, you should be able to gain access to the funds quickly and easily when in an emergency. This makes it hard to maintain balance. Keeping it in a separate bank account and having the discipline to not touch it unless in an emergency situation is recommended.

When should you use emergency funds?

When a need for cash arises, people often classify it as an emergency even when it is not. For it to qualify as one, it should at least cover these three qualifications;

  1. It should be unforeseen
  2. It should be necessary
  3. It should be urgent

Tips to save for an emergency fund

1. Come up with a saving plan

Have a list of all your periodic incomes and expenses and then determine how much you can realistically put towards the emergency plan savings.

2. Trim your budget

To make the savings grow faster, it is important that you eliminate the unnecessary expenses in your budget.

3. Automate payments to the emergency fund

The process of having to withdraw funds from your main income account and depositing it into your emergency fund account can be tedious and time-consuming. It is also possible that you may forget to do this once in a while. 

Having the bank pay directly to your emergency account solves this problem. This also helps you save before you spend.

4. Save windfalls

After receiving an unexpected injection of funds, like a salary increment, set aside most of that income for your savings including your emergency fund.

5. Adjust the savings plan

Your savings plan should not be set in stone. Any unexpected change in your incomes or expenses should also have an impact on your savings.

How healthy is your emergency fund account?

Few public employees find the need to have an emergency fund. After all, you could secure a loan if you needed it and your job is secured. What happens when one source of income dries out unexpectedly? Start saving into your emergency fund today!


About Mountain West Financial and the CalPATH Home Loan Program

Mountain West Financial is the exclusive lender offering CalPATH, the #1 home loan program for Teachers, Police Officers, Firefighters, and other public employees who serve our local California communities.

You may contact our CalPATH Hotline @ 800-310-7577, seven days a week from (8:30 am to 8:00 pm). A CalPATH advisor will be standing by to answer (any & all) questions you may have about the home buying or refinance process.

We look forward to working with you soon!




Joe MooreBranch Manager


Links to sources used

  1. We Asked 11 Experts How Much We Should Have in Savings – And Got 11 Different Answers –