Question

If the Potinsky household spends ​$33 comma 500 annually on all living expenses and​ long-term debt, calculate the amount recommended for an emergency fund. How might household circumstances​ (e.g., wage earners in the​ household, available​ credit, and type and stability of​ employment) affect this​ decision? The emergency fund amount would range from ​$ nothing to ​$ nothing. ​(Round to the nearest dollar and enter the range from lowest to​ highest.)

Answer 1

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Answer:

Given,

Potinsky spends around $33,500 annually on living expenses.

As a rule of thumb, in personal finances, Potinskyl should have a sufficient amount of liquid assets to cover 3-6 months of expenses for emergencies.

Monthly expenses = 32500/12 = 2791.67

He should have ($2791.67*3) to ($2791.67*6) as emergency funds. => 8375$ to 16750$ as emergency funds