In "normal" times when the economy is doing well, the traditional financial advice is to set aside three to six months' worth of living expenses in a liquid account such as a money market fund or short-term CD. In an unstable economy with high unemployment, it might be wise to set aside between eight months' to a year's worth of living expenses, especially if the industry that you work in is experiencing declining sales and profits and layoffs have occurred or are predicted.
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