Is $10,000 Enough to Have in Your Savings Account?

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The Federal Reserve reports that 37% of Americans could not cover an unplanned $400 expense by dipping into their savings. Rather, they'd have to borrow money or sell something to come up with the cash. So if you have $10,000 in your savings account , you might assume that you're all set financially.

Indeed, having $10,000 in savings is something to be proud of. But whether it's enough savings depends on your personal situation.

Make sure you're covered for emergencies

You never know when you might fall victim to an unplanned financial expense. That expense could be a large home repair, a car that unexpectedly needs work despite not being that old, or a medical emergency that leaves you on the hook for a huge ER bill.

You might also lose your job without warning due to circumstances outside your control. And from there, it could take months to find a suitable replacement job.

That's why you need to have enough emergency savings to cover three to six months of essential bills. This way, if you were to lose your job, you'd have funds to tap before needing to charge basic expenses on your credit cards . Also, if you have enough cash in the bank to pay for three to six months of bills, then there's a good chance your emergency fund will suffice in covering something like a home or car repair, too.

But whether $10,000 covers you for that purpose depends on your personal spending. So while a $10,000 emergency fund may be more than enough for one person, it may not be enough for another.

If your basic expenses like rent, car payments, utilities, food, and so forth come to $4,000 a month, then you're not quite where you want to be with $10,000 in the bank. In that situation, you should be aiming for at least $12,000 in emergency savings, which is enough to cover your essential costs for three months. You may even want to aim higher -- closer to the six-month mark -- if you have dependents or a unique job that's harder to replace.

On the other hand, if your basic expenses come to $2,500, then you may decide that you're all set with $10,000 to your name. In that case, you have a four-month emergency fund, which is perfectly suitable.

Don't just fixate on a number

It's easy to look at a number like $10,000 and assume that your savings are in a great place. But depending on your personal spending, you might need more than $10,000 in the bank to be truly covered for an emergency situation.

Take the time to add up your essential monthly expenses, and multiply that number by three as a starting point. That's the savings goal you should be working toward -- whether it's more than $10,000, less, or exactly the same.

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