What should be a good nest egg amount? Like if I get in a horrible car accident and have to go to the hospital.
Justin: That really depends on what your expenses will be.
Suppose that you get into a car accident and are too injured to work.
You will need enough savings to pay your everyday expenses (rent, groceries, etc.) for several months, until you either go back to work or start receiving disability pay (which may be much less than your current income).
Your medical bills will mostly be covered by insurance, but you do need the deductible and any coinsurance that you are responsible for.
And you'll want to replace your car.
If you have great insurance, then your financial worst case might be losing your job. You'll only need to pay regular expenses, and maybe moving expenses if your next job is far away. Consider the maximum amount of time you could be job-hunting.
The typical answer is 6 months of income, but the real answer is that you should save as much as you can. It's not something that you can put a dollar figure on because there's no telling what the emergency will be. It's just important that you care enough to start saving now, good luck to you.
15,000 is pretty good for most people.
six months of take home pay should be available to you in a savings account earning virtually zero, but is a safeguard.
Think of it in terms of the after-effect of time… Let's say you're in the hospital and now you find out that your recovery will take 6 months… and when you approach your employer about how long you're going to be out and they say "we can't wait for you to get better" and now you're out of a job as well… So you'd need a few more months to find another job once you're better… You're looking at 9 months you're out of commission… 9 months worth of expenses that you would need to stay afloat.
Some people only plan for a few months of emergencies, others will do up to a year. Take the amount you spend on a monthly basis and multiply it by however many months you want to have a safety net.
a years worth of living expenses
hard to say, you might have a real disaster that no way is covered by your savings account, no one expects to have something happen and plan to have that kind of money on hand to pay for it, I don't think any one lives that way
$1000 available/immediately withdrawable cash for starters, after that, a minimum of 6 months of current day-to-day/month-to-month expenditures.
6 months income is good, although not realistic for everyone
They always say 6 months of income, but do far more if you possibly can.