When the unexpected happens, you more than likely need to pony up cash fast. Emergencies like losing your job, hospital visits or even replacing your phone can be costly. Even though you might not experience emergencies every day, it’s still important to have some money set aside for surprise expenses.

This brings up an important question: How much should you have in an emergency fund? Dave Ramsey, author and radio personality, suggests $1,000. But some expenses can’t be covered by $1,000 easily. Take a look as to why you should have an emergency fund and get insight on how much you need depending on your situation.

Why you should have an emergency fund

Only 39% of Americans have enough money to cover a $1,000 emergency with savings. If you aren’t able to cover an emergency, you’re left with less than ideal choices. You may be tempted to stop paying your bills. You could turn to credit cards with high-interest rates. Worst case, some even turn to pawn shops or even the dreaded payday lender.

A well-padded emergency fund helps you pay for unexpected expenses and can also help you avoid some of the nightmare scenarios listed above. Small monthly shortfalls can snowball over time and turn into major headaches.

How much should save in your emergency fund?

The short answer to this question is it depends. For example, if you work in a highly sought after industry, like software development, it may be easier for you to find a replacement job versus someone who works as a fashion designer.

I suggest two to three months’ worth of living expenses stashed in an emergency fund, at a minimum. Why? Because it covers most basic emergencies, like a flat tire or trip to the emergency health clinic, while allowing you to maintain your current standard of living.

Depending on how many mouths to feed and bills you have, this figure could be significantly greater. Your age and number of dependents who rely on you will also have a significant impact on how much you need to save.

Tyla Tenpenny, a 30-year-old from Kansas, decided to increase her emergency fund because of her job contract and responsibilities as a mother. “I have two young kids and my job is under contract with the state. There’s a possibility that I could lose my job at the end of the contract,” said Tyla. For those reasons, she and her husband keep between $7,000 and $10,000 in their emergency fund at all times.

If you’re thinking about leaving your job, it also makes sense to save enough to tide you over through your job hunt period. The median length of unemployment is nearly nine weeks, according to the July 2019 report from the Bureau of Labor Statistics.

Prepare to budget more time depending on how in-demand your role is and how confident you are in your interviewing skills. In some cases, it may be more prudent to use your vacation days for job interviews if you’re thinking of leaving your job, as this avoids the risk of unemployment for an extended period.

An emergency fund helps you feel less frantic

Lack of an emergency fund may be just one reason why 30% of Americans are constantly stressed about their finances. If you want to reduce your financial jitters, setting aside savings for emergencies could put you at ease.

Maggie Micinski, a 26-year-old from New York, was faced with a devastating emergency. She wasn’t paid for two pay periods during the 2018 government shutdown. “I worked without pay during those 35 days, but I was still required to pay my student loan debt, plus cover rent and basic living expenses,” said Maggie.

Luckily, Maggie had a very understanding landlord who allowed her to delay her rent payments until she received back pay. She also had $2,000 in savings that helped her during those difficult weeks. “I was so thankful to have an emergency fund to fall back on. I realized that I need at least one to two months of expenses to cover my bases,” said Maggie.

Where should I stash my cash?

That being said, what’s a good place to put your rainy day fund where you don’t have to worry about your money disappearing when you actually need it?

“While it’s tempting to invest all your emergency cash in mutual funds, this exposes you to volatility and makes it hard to access your money when you actually need it. It’s a good idea to park emergency funds, that you anticipate needing, in a high-yield savings account where they can earn a healthy return and maintain their value through good markets and bad,” said Kenny Zhu, a banking expert from LendingTree.

There are plenty of savings options to choose from, but look for accounts that have no recurring fees and pay high interest rates. The idea is to grow your idle emergency fund balance for when you need it most.