Emergency Fund Calculator
How much cash should your business actually hold?
Built from your own essential costs rather than a generic rule. Each field explains what to include and shows an example figure, and everything is calculated in your browser — nothing is stored or sent anywhere.
Hayley Duster — writer and solo business owner
Software, insurance, workspace, accountancy — the things you cannot switch off. Exclude ads and subcontractors you could pause.
Example: £300 software + £40 insurance + £120 accountancy + £440 workspace = £900
Housing, food, bills, childcare and loan repayments. The lowest amount you could draw for several months without falling behind.
Example: £1,200 rent + £600 bills and food + £400 other = £2,200
Money you owe to HMRC or have ring-fenced for a known tax bill. It is shown separately and is never counted as emergency-reserve cash.
Example: £2,400 held for a forthcoming tax payment
Include only if you would continue paying it during a no-income period. It is optional and separate from tax liabilities.
Example: £400 a month into a personal pension
Three months is a floor. Six suits lumpy or client-concentrated income; nine to twelve if you are the sole earner in your household.
Example: 6 months for a freelancer with two main clients
Only money you could spend tomorrow. Exclude tax owed, client deposits, credit cards and overdrafts.
Example: £3,000 in a separate savings account
What genuinely survives a normal month, not your best month. Round down.
Example: £350 a month by standing order the day after you invoice
£3,500 of essential costs per month, covered for 6 months. Tax liabilities are kept separate.
14% of your target is already in place.
Cash set aside divided by the reserve monthly need — how long you could pay essential costs with no new income. Under 1 month is fragile; 3 or more gives you room to make decisions calmly.
This is a known liability, not part of the emergency reserve and not available to cover a no-income period.
Recommended reserve plus tax cash to keep separate. This is a planning view, not a tax calculation.
What is still missing between today's cash and your chosen target.
Gap divided by monthly saving, assuming no withdrawals along the way. If the timeline feels impossible, set the target to three months first and revisit later.
How this is calculated (version 1.1, reviewed 24 August 2026)
- Emergency reserve = essential business costs + minimum personal drawings + an optional pension contribution, multiplied by the months of cover chosen.
- Tax owed or already ring-fenced is kept separate from reserve money and added only to the separate protected-cash view.
- Interest, inflation and investment growth are ignored — a reserve is about access, not returns.
- The time-to-target figure assumes you save the same amount every month and never dip into the fund.
- Credit cards, overdrafts and business loan facilities are not reserves and are excluded. All calculations stay in this browser; the numbers you enter are not sent to analytics.
A worked example
A consultant has £900 of essential business costs, needs to draw £2,200 personally, chooses to protect a £400 monthly pension contribution, and has £2,400 ring-fenced for tax. She wants six months of cover, holds £3,000 of reserve cash and can save £350 a month.
- Reserve need a month
- £900 + £2,200 + £400 pension = £3,500
- Six-month reserve target
- £3,500 × 6 = £21,000
- Tax held separately
- £2,400 is not reserve cash
- Cover today
- £3,000 ÷ £3,500 = 0.9 months
- Time to reserve target
- £18,000 ÷ £350 ≈ 51 months
Six months is out of reach at this saving rate, so the useful reading is the sequence: a three-month reserve target (£10,500) is still far off, but one month of cover (£3,500) is weeks away. The tax cash remains separate throughout. Hit the reachable reserve target first, then extend it.
How to hold it
- Keep the reserve in a separate account, not your working current account.
- Never count money owed to the tax authority or a client as part of your reserve.
- Reaching one month of cover is worth more than planning for six and saving nothing.
This tool organises your own figures and is not financial advice. Talk to a qualified accountant or adviser about your specific circumstances.
The Resilient Founder
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