With tariffs creating economic uncertainty, many Americans are rethinking their emergency savings — and whether to keep some physical cash at home.
Not every financial planner thinks physical cash is essential, but some say it’s wise to keep a small amount on hand in case of power outages, natural disasters or payment disruptions.
“I would be comfortable with $500 to $1,000 in cash for unforeseen issues” like a hurricane, says Matthew Saneholtz, a certified financial planner at Tobias Financial Advisors in Florida.
Keeping $300 to $500 at home for emergencies or unexpected cash-only expenses is reasonable, says Crystal McKeon, CFP at TSA Wealth Management.
Don’t go ‘overboard’ hoarding cash
Keeping cash at home is “a personal choice,” says Melissa Caro, CFP and founder of My Retirement Network. While she says it can be “useful” in some situations, she cautions against relying too heavily on it.
“I wouldn’t go overboard with physical cash, since it’s not FDIC-insured and doesn’t earn interest,” Caro says. FDIC insurance covers up to $250,000 per person, per bank, across all accounts, if the FDIC-insured bank fails.
There are other downsides, too. “It can be subject to loss, theft, destruction or even impulse,” says Nicole Sullivan, CFP and co-founder of Prism Planning Partners. “If you have a significant amount of physical bills on hand, you may be more tempted to spend on ‘extras’ that you otherwise would avoid.”
If you do keep cash at home, be discreet about it, says McKeon: “Even if you think these items are safely stored in a safe, spreading this information is likely to make you a target for thieves.”
Top up your emergency savings, too
Beyond a small stash of cash at home, now is a good time to revisit your emergency fund. Financial planners typically recommend saving three to six months’ worth of essential expenses in a checking or high-yield savings account — someplace accessible, but separate from your day-to-day spending.
But with greater economic uncertainty, you might want to extend those savings to as much as a year’s worth of expenses. “If you are in an industry with layoffs likely ahead … shoot for more like nine to 12 months,” Saneholtz says.
Still, many Americans fall short when it comes to emergency savings. About 42% have no emergency savings, and 40% couldn’t cover a $1,000 expense, according to a 2025 survey from U.S. News & World Report.
If you’re starting from zero, remember that having any sort of financial cushion is better than none. “If you start at $50, it’s more than you had last month,” McKeon says. From there, try to increase your savings as your budget allows, especially by trimming non-essential spending, she says.
For an initial goal, savings of $1,000 is useful “to have on hand to fix your car, to cover small repairs on the house and minor medical situations,” says McKeon.
