How to Build a Bulletproof Emergency Fund: The 3-6-9 Month Rule for Financial Security

Inside the Episode: The Emergency Fund Blueprint

Financial Stability and Peace of Mind Expert Wealth Stewardship by David Angway, RFP.

[0:00] – What does a Registered Financial Planner (RFP) do? An introduction to expert financial management.

[2:45] – Why is an emergency fund important? Building the foundation of your financial house.

[5:10] – How much should I have in my emergency fund? The 3-6-9-month savings rule explained.

[8:30] – What is the difference between savings and an emergency fund? Saving to spend vs. saving to protect.

[12:15] – Where is the best place to keep an emergency fund? High-yield savings and liquidity.

[16:40] – What is considered a financial emergency? Setting boundaries to avoid fund leakage.

[21:20] – How does an emergency fund affect business decisions? The psychology of financial security.

[25:55] – Can an emergency fund save a business? A case study on entrepreneurial resilience.

[29:30] – How to build an emergency fund from zero? Practical steps when living paycheck to paycheck.

[33:15] – How to teach children about financial resilience? Building a legacy of stability.

[35:00] – How to find a verified financial coach in the Philippines? Personalized coaching with David Angway.

The Expert Breakdown: FAQ Summary

Q: Why do you call an Emergency Fund the "Foundation" of a financial house?

David Angway: Most people want to jump straight into investing in stocks or real estate. However, without an emergency fund, your "financial house" is built on sand.

The moment a medical crisis or a job loss hits, you are forced to sell your investments at a loss or go into debt. An emergency fund ensures that your long-term wealth stays protected, no matter what happens in the short term.

Q: Can you explain the "3-6-9 Month Rule"? How much is enough?

David Angway: The amount depends on your risk profile and stability:

• 3 Months of Expenses: Ideal for single individuals with stable corporate jobs and low dependents.

• 6 Months of Expenses: The standard for families with children or those with moderate income volatility.

• 9 Months (or more) of Expenses: Essential for entrepreneurs and freelancers whose income is unpredictable. This isn't based on your salary, but on your actual monthly survival expenses (rent, food, utilities, insurance).

Q: Where is the best place to keep this money? Should I invest it?

David Angway: Never invest your emergency fund in "locked" or volatile assets like the stock market or long-term real estate. The goal isn't high returns; the goal is Liquidity and Accessibility.

I recommend high-yield digital bank accounts or traditional savings accounts that allow you to withdraw the cash within 24 hours. If you can't touch the money during an emergency, it isn't an emergency fund.

Q: How do I stop myself from spending this money on "wants"?

David Angway: You must define what constitutes a true emergency. A "Sale" at the mall is not an emergency. A "Promo" for a flight is not an emergency. A true emergency is an unplanned, necessary expense—usually related to health, safety, or loss of income.

I advise my clients to keep this fund in a separate bank account without a debit card attached to it to reduce the temptation of "fund leakage."

Clean Takeaways: Your Blueprint for Stability

• Prioritize Foundation Over Growth: Build your 3-month starter fund before you put a single peso into aggressive investments.

• Calculate Your Survival Number: Know exactly how much it costs you to live for one month. Multiply that by 3, 6, or 9.

• Accessibility is King: Keep the fund liquid. High-yield digital banks are great for earning 4-6% interest while keeping the cash reachable.

• The Peace of Mind Dividend: An emergency fund isn't just about money; it’s about the psychological freedom to make better life and business decisions without fear.

• Consult a Professional: If you're struggling to balance debt repayment and building your fund, seek a Registered Financial Planner to help you audit your cash flow.

Ready to build a financial house that stands the test of time? For expert wealth management and coaching, visit davidangway.com.