It's always good to have access to a chunk of cash; an emergency fund that allows you to stay on track if you have unexpected expenses.

To figure out how much cash to stash, figure out your monthly budget...and multiply it by six. That may seem like overkill, but think of all the expenses:

  • Mortgage or rent
  • Food
  • Electricity
  • Internet
  • Child care
  • Medical expenses

A good emergency fund should cover six months’ worth of expenses. Unfortunately, we've learned over the last few months that it's more important than ever to have this emergency fund. It takes time to build it as having such an ample emergency fund is a big ask.

It is possible to do, but it requires more than a little effort. One way that is inherently designed to be easy involves the “keep the change” feature on checking accounts. It seems like every bank has some form of this feature, which rounds up to the next dollar on every purchase and deposits the “change” in another account of your choosing.

Another strategy that can dramatically reduce your monthly expenses is to review all of your subscriptions. The internet is full of testimonials from people who let their unused gym membership go on and on, and the takeaway is always the same: Do it now! There is even an app that purports to find all of your subscriptions and do the canceling for you, but I have not reviewed it.

Categorizing your expenses often turns out to be a wakeup call. People often find it unacceptable that they are spending so much on X, and make a point of reducing it — often out of principle. It’s a strategy that appeals to the brain, and it works to keep costs down once you make your adjustments.

There’s another strategy that works well during the holidays. As long as you have a good hand sanitizer, cash still works. You can silo cash into different envelopes and do what you want with them. Some of my clients only leave the house with a certain amount of cash and nothing else, and it works for them!

As for where to put the money, my advice is to steer clear of investments and head for the safety of a money market account. Don't worry that it doesn't earn interest, it's just a backup plan in case of emergency. Rules for withdrawing from money market accounts are strict, which might come in handy if you have trouble saving. And make your deposits as soon as you get paid!

Over the last few years we have seen people suffer devastating financial consequences as a result of the pandemic. At the same time, extreme weather is destroying property in every corner of the country, and it’s only forecast to get worse. Maybe “the world is a scary place” is getting old to you — I get it, but that doesn’t change the fact that having a lump sum of money is a good thing.

Judy Heft is the CEO/founder of Judith Heft & Associates, a Financial and Lifestyle concierge celebrating 26 years in business helping people stay financially organized. She is a Certified Money Coach and the author of “How to Be Smart, Successful and Organized with Your Money.” For more information visit