# Your emergency fund: how much, and where to keep it

> Size an emergency fund, then compare where to hold it: T-bill, ultrashort and bond ETFs on yield, return and falls, using real dated ETF data.

Data as of Nov 10, 2026. Rebuilt every trading night.

## Your emergency fund: how much, and where to keep it

Data as of Nov 10, 2026. Rebuilt every trading night.

Over the year to Nov 10, 2026 , $12,000 in BIL, a T-bill ETF, earned about $440 , and in AGG, a core bond ETF, about −$39 .

Building Wealth · Lesson 1 of 6 1 2 3 4 5 6

Set the size of your fund. See what each of four ETFs earned on it over the year. Size of your fund $12,000 On $12,000: BIL earned $440, JPST earned $420, SHY earned $213, AGG earned −$39. Hypothetical fund size. One-year total returns, Nov 10, 2025 to Nov 10, 2026.

### The question

"I know I need an emergency fund. How big should it be, and where should the money actually sit?"

### The idea

- An emergency fund is money set aside for a surprise: a lost job, a car repair, a medical bill. Its one job is to be there, in full, on the day you need it. A return is a bonus.

- So you want three things from its home, in this order: - Its value doesn't fall when you need to take it out.

- You can reach it within days.

- It earns something while it waits.

- A common size is 3 to 6 months of needs : the rent, food, bills and debt payments from the budget in Where your money goes . With needs of $2,000 a month, that is $6,000 to $12,000.

### Worked example

Take $12,000 and four ETFs it could sit in. All numbers cover the year Nov 10, 2025 to Nov 10, 2026 .

- BIL holds Treasury bills that mature (are paid back) in 1 to 3 months.

- JPST is an ultrashort fund: mostly loans maturing within 3 years, including loans to companies.

- SHY holds US Treasury bonds maturing in 1 to 3 years.

- AGG holds a broad mix of US bonds, with 30.9% maturing in over 20 years.

The 12-month yield is the cash a fund paid over the year, as a share of its price a year ago. Total return ( Cash or invested ) adds the price change to that cash.

| Fund | 12-month yield | Total return | $12,000 earned |
| --- | --- | --- | --- |
| BIL | 3.7% | +3.67% | $440 |
| JPST | 4.1% | +3.50% | $420 |
| SHY | 3.5% | +1.77% | $213 |
| AGG | 4.0% | −0.32% | −$39 |

Step 1. Earned = $12,000 × total return. For SHY: $12,000 × 1.77% = $213 .

Step 2. Compare yield with total return. BIL's two match: its price barely moved. AGG paid 4.0% but returned −0.3% , so its price fell by roughly the difference. SHY's price fell 1.8% , which took its 3.5% yield down to a 1.8% return.

Step 3. For scale: in the month to Nov 10, 2026 , SPY, an S&P 500 fund, fell 3.7% , about $442 on $12,000. Stocks are a poor home for money with a job this short.

The longer a fund's loans run, the more its price can move ( Bonds for income shows why). Short Treasury bills barely move.

### The common mistake

"Pick the highest yield." This year, AGG's 4.0% yield returned less than BIL's 3.7% , because AGG's price fell .

Now check each fund's worst fall ( Your first fund check ). Over each fund's full ETFIQ scorecard (the windows differ), BIL's was 0.4% ( January 2010 to November 2026 ), JPST's 3.2% ( May 2017 to November 2026 ) and AGG's 18.2% ( July 2011 to November 2026 ). An emergency fund can't afford an 18% fall.

### Check your understanding

Pick an answer to see why. Two of three right passes the lesson.

1. What is the first job of an emergency fund? A Be there, in full, when you need it B Earn the highest return C Beat inflation every year D Pay out monthly cash Answer: A. Be there, in full, when you need it. a surprise bill can come in any month, so the value matters more than the return. Not B: a higher return usually comes with prices that can fall. 2. Over the year to Nov 10, 2026 , how much did $12,000 in SHY earn? A About $426 , its 3.5% yield B Nothing C About $440 D About $213 Answer: D. About $213 . $12,000 × 1.77% total return = $213 . Not A: the yield leaves out SHY's 1.8% price fall. 3. Dee needs $3,000 a month and wants 4 months covered. Fund X yields 5% and holds 20-year bonds. Fund Y yields 3.7% and holds 3-month Treasury bills. Which fact matters most? A Fund X pays more cash B Both are ETFs, so they behave alike C Fund X's long bonds can fall in price, so the $12,000 might not be there in full D Fund Y is older Answer: C. Fund X's long bonds can fall in price, so the $12,000 might not be there in full. long loans swing in price, and an emergency fund can't wait for a recovery. Not A: the extra 1.3 points of yield is about $156 a year on $12,000; a price fall can cost far more.

### Takeaways

- Size it first: 3 to 6 months of needs.

- Hold it where the value barely moves.

- Judge a cash-like fund by total return and its worst fall, not by yield alone.

### Do it on ETFIQ

Compare where your emergency money sits with a T-bill fund

### Where to next

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Source: ETFIQ, independent ETF data. Recomputed nightly from public filings and prices.
Cite: ETFIQ, Your emergency fund: how much, and where to keep it, data as of Nov 10, 2026. https://etfiq.com/academy/building-wealth/emergency-fund/
Licence: https://etfiq.com/license/ Data ETFIQ computes is free to use with attribution: ETFIQ (etfiq.com). Issuer data stays under its owner's terms.
HTML: https://etfiq.com/academy/building-wealth/emergency-fund/