Get All Access for $5/mo

Financial Advisors Reveal How Much Cash You Need to Survive a Recession Based on Life Stage Whether you're a new graduate or a retiree, peace of mind is priceless.

By Amanda Breen

With inflation soaring, the stock market tumbling, and the possibility of a recession on the horizon, many Americans are wondering how much cash they should have on hand to weather the storm.

How much money you will need to stay afloat during a recession will vary depending on life stage and circumstance — whether you're a dual-income household, single earner, entrepreneur, or retiree.

Dual-income families, for example, won't need to save as much as someone with a single income. Two (or more) income families should aim for three to six months of living expenses in reserve, Christopher Lyman, a certified financial planner with Allied Financial Advisors in Newtown, Pennsylvania, told CNBC.

Related: 5 Personal Finance Hacks to Help You Invest

If you're on your own, you might want to make that closer to the six-month mark, experts say. A good rule of thumb? Make sure you have just enough not to worry.

"For a working individual earning income, the goal should be to have just enough cash to provide an emergency buffer to protect against any pitfalls that could hinder financial well-being," Sergio Garcia, a certified financial planner at BFS Advisory Group in Dallas, told Bankrate.

Generally, entrepreneurs face more economic uncertainty than people with employers, so they should try to have more cash at the ready.

Lyman told CNBC that entrepreneurs and small-business owners should save one year of business expenses, explaining that "this advice saved quite a few of our business owner clients from shutting down due to the pandemic."

Related: 4 Personal Finance Tips Every Entrepreneur Should Know

Ideally, retirees have set themselves up with retirement accounts to enjoy their golden years, but that doesn't mean they should forego any cash savings — quite the opposite, in fact.

For those with a balanced portfolio of 60% stocks and 40% bonds, consider keeping approximately three years' worth of anticipated withdrawals in cash, Michael Yoder, a certified financial planner and Principal at Yoder Wealth Management, writes on Kiplinger.

In these uncertain times, setting enough aside provides peace of mind — whether you're a recent graduate or a retiree.

Amanda Breen

Entrepreneur Staff

Senior Features Writer

Amanda Breen is a senior features writer at She is a graduate of Barnard College and received an MFA in writing at Columbia University, where she was a news fellow for the School of the Arts.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Business News

Jack Dorsey Says It Will Soon Be 'Impossible to Tell' if Deepfakes Are Real: 'Like You're in a Simulation'

Dorsey said we will "not know what is real and what is fake" in the next five to 10 years.

Money & Finance

Avoid These 10 Mistakes Entrepreneurs Make with Money

Despite the challenging statistic that only 5% of startups survive beyond five years, common financial pitfalls often contribute to their failure. Through personal observation, I've identified the prevalent financial mistakes made by entrepreneurs.

Business Ideas

63 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.

Business News

50 Cent Once Sued Taco Bell for $4 Million. Here's How the Fast-Food Giant Got on the Rapper's Bad Side.

The brand suggested that 50 Cent change his name to match its "Why Pay More?" value menu promotion prices. The rapper was not amused.

Business News

Some Car Dealerships Are Selling Cars the Old Fashioned Way Following Massive Cyberattack

CDK software services an estimated 15,000 dealerships in the U.S.

Thought Leaders

The 8 Taylor Swift Strategies Every Tech Leader Should Apply in 2024

From more progressive intellectual property management to breakthrough community engagement, here's what tech entrepreneurs can learn from Taylor Swift.