Accident, job loss, illness: you should set aside that much money for emergencies

A rule of thumb is that at least three households’ monthly income should be on the side. This makes it possible to cope with a complete loss of income for several months – as a rule, fixed costs are significantly lower than wages.

If Fabio Marchesin (35) is what he wants, there is no apparent reason why there should be only three or even six or nine months’ income as savings. The financial expert writes in his blog “Finanzfabio” that an important clue is the situation in case of job loss. In the event of dismissal, those affected receive 70 or 80 percent of their previous salary from the regional employment center – depending on the child or spouse’s child support obligations.

But the money does not flow directly, but after days of waiting. It can take up to 20 working days for people with higher salaries. Therefore, for the most extreme emergency, the person must have at least one month’s salary high. But be careful: If you resign yourself, you must also take into account the days off from the unemployment fund. These periods can be up to 60 days. In this case, it is better to have three months’ salary on the side.

Aren’t you afraid of diseases?

One saving argument is: “What if I have an accident or become seriously ill?” Marchesin also denies this. According to him, this would cost at most 3,200 francs: the highest exemption was 2,500 francs, the highest exemption for a health insurance was 700 francs. This will be covered by a monthly fee on the high edge for most. Also, you cannot be fired if you are sick. However, in the case of a long-term chronic illness, the financial situation can become critical.

Urgent emergencies can usually be met with a few thousand francs in the savings account. But the real savings has a lot to do with subjective feelings: When do I feel good?

Saving gives confidence

Some panic when their account balance drops below 50,000 francs, while others barely make ends meet. The sense of security often has to do with variable costs, i.e. whether one can afford and want a vacation or a new car. If these expenses are not included, you must cut back on the desired standard of living.

It becomes more difficult in an emergency when fixed costs can no longer be met. Fixed costs include rent, health insurance, water, electricity and heating costs, cell phone charges, taxes and all subscriptions, and perhaps childcare costs for families. This is usually several thousand francs a month.

Open a virtual piggy bank

Anyone planning larger investments should save more than their iron reserves. For example, in a savings account that you later use for a trip abroad, a home or study. A kind of virtual piggy bank that collapses when the desired amount of money is reached.