Everyone knows that they should have an emergency fund. However, everyone seems to struggle with how much they should have. Dave Ramsey says $1,000 until you pay off all debt but the mortgage, then 3-6 months of expenses. Suze Orman likes the full 8 months of expenses (and currently of take home pay) in the emergency fund. Liz Weston wants you to have at least $500 in the bank so you don't bounce anything. She says that having a large emergency fund is great, but does not specify the amount. The amount, is really whatever you are comfortable with.
However, if you are like me and you want to have more information before you know what you are comfortable with, one way to establish your emergency fund is to base it on the unemployment rate. Therefore, you can look at the general current unemployment rate (March 2011) and see that you need 9.2 months in an emergency fund. You can tailor this to your location as well by selecting the city or state on the left hand side. You could also look at the raw national statistics and determine your current unemployment rate by sex, age, ethnicity, educational attainment, etc.
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