Americans are strained by rising costs of living. These savings tips can alleviate financial stress and cushion against unexpected expenses.

CHICAGO, Aug. 10, 2026 – The climbing cost of living is continuing to strain households nationwide. More than half of Americans (53%) say they can’t cover an unexpected $1,000 expense with their savings alone, according to Bankrate’s 2026 Annual Emergency Savings Report. Worse, 18% of adults report having no emergency savings at all, while 33% have less than they did last year.

“In today’s unpredictable world, an emergency fund isn’t an optional luxury; it’s a foundation that prevents an unexpected expense from turning into costly credit card debt or early withdrawals from retirement savings,” says Brian Kearns, CPA, CFP, founder of Haddam Road Advisors and personal financial planning columnist for Insight, the magazine of the Illinois CPA Society (ICPAS).

To help individuals break the cycle of living paycheck to paycheck or with uncomfortable financial risks, ICPAS is highlighting an actionable strategy drawing on core principles from its certified public accountants (CPAs) and financial authority Kiplinger: The “1-3-6” strategy, which makes building an emergency savings account with the widely recommended six months of living expenses more achievable alongside building better saving habits.

The ‘1-3-6’ Emergency Savings Strategy

By breaking the goal of saving a six-month safety net of living expenses into progressive milestones, anyone can become a savvy saver regardless of their starting point.

• The 1. One month of living expenses: Begin by calculating essential, must-have monthly expenses—housing, utilities, food, transportation, health insurance, childcare, and minimum debt payments, etc. Saving one month’s worth of these essential expenses is the first milestone and provides immediate psychological relief, protects against minor unexpected expenses, and begins weaving a financial safety net.

   

• The 3. Three months of living expenses: Working toward expanding the emergency fund to cover three months of essential expenses creates a stronger safety net capable of absorbing more costly short-term financial setbacks, such as employment disruption, high medical deductible, pet emergency, or small but urgent appliance or car repair.

   

• The 6. Six months of living expenses: Reaching six months of core living costs saved in an emergency fund affords greater financial freedom and flexibility. In the event of a sudden or extended layoff or other major expense, a fully funded emergency fund buys time and protects against financial desperation.

5 Steps to Accelerate Emergency Savings

To help reach the 1-3-6 milestones faster, consider these five steps:

1. Set up a separate account: It’s best to keep emergency savings separate from checking/debit accounts to avoid impulse spending. Instead, open a high-yield savings account or money market account that offers FDIC insurance, is fully liquid, and pays a competitive interest rate that grows your balance. Avoid locking up emergency savings in long-term CDs or stock market investments to ensure the funds are readily accessible.

    

2. Automate saving: If finding the willpower to save is a challenge, setting up automatic transfers to your emergency fund the day after payday will help ensure you reach your savings milestones.

    

3. Rein in discretionary spending: Temporarily (or indefinitely) cutting back on unnecessary spending will immediately free cash to funnel into your emergency fund. Easy cutbacks could include canceling unused or underused subscriptions and memberships, dining out less, skipping a shopping trip, or revisiting phone or internet plans that could be scaled down.

    

4. Raise extra cash: A quick way to build an emergency fund is to sell unused household items (think clothing, instruments, sports equipment, forgotten collectibles, etc.). Selling even just a few items whenever it makes sense could afford a nice savings boost.

    

5. Reduce high-interest debt: Credit card and personal loan debt generally carry high interest that eats away at savings. Prioritizing reducing or eliminating these debts alongside building your emergency fund will leave you in a better long-term financial position. Even if you can’t pay off this debt quickly, paying it down, and at least covering the minimum amount due, helps reduce costly interest expenses over the long run.

Ultimately, starting small is better than not starting at all. Redirecting just $100 a month to your emergency savings through reduced spending and the other steps above could quickly solidify your safety net. Set clear rules for when to use your emergency savings, and if you do tap your fund, prioritize rebuilding it.

For those wanting additional guidance, a CPA can help individuals review their budgets, optimize tax efficiency, and create a realistic financial plan tailored to their goals. ICPAS’ free “Find a CPA” directory can connect individuals with a trusted, strategic advisor that’s right for them based on location, types of services needed, and languages spoken. Find a CPA at www.icpas.org/findacpa.