Most money advice starts with "save three to six months of expenses." For a lot of people that number is so big it stops them from starting at all. A starter fund is smaller, faster and more useful in the first year.
Step one: $500
Five hundred dollars covers most of the surprises that end up on a credit card: a tow, a vet visit, a cracked phone screen. Get here first, even if it takes a few months.
- Turn on round-ups and point them at a goal called "Emergency."
- Move $25 automatically every payday.
- Put any refund or rebate straight in.
Copper tip: Name the goal in the app. Members who name a goal save about 40% more than those who don't.
Step two: one month of rent
Once you have $500, aim for one month of housing costs. In San Francisco that is a bigger number, so split it into quarters and celebrate each one.
A starter fund is not about the amount. It is about not having to borrow when something goes wrong.
Where to keep it
Keep it separate from checking so you are not tempted, but somewhere you can reach the same day. A high-yield savings account earning 4.10% APY does both.
What counts as an emergency?
Anything urgent, necessary and unexpected. A concert ticket is none of those. A dental filling is all three.