Emergency Fund Vs Debt Calculator

You have a credit-card balance charging real interest, and no real cushion in savings. Every spare dollar this month could go one of two places: attack the debt, or start an emergency fund. This is one of the most common early-money questions there is, and it has two right-sounding answers that pull in opposite directions — 'a guaranteed 22% return beats any savings account' versus 'what if something goes wrong before the debt is gone?' This lesson races both orderings' net worth over five years and shows that they're not actually in conflict: the same guaranteed-return logic from the pay-debt-vs-invest lesson decides who wins on paper (attacking the debt, almost always, at a real card's rate), but that verdict hides a separate, real cost the net-worth number doesn't capture — attacking the debt first means running with an EXACT $0 cushion for however long the balance survives, so any real emergency in that window becomes brand-new debt at the card's rate, no exceptions. A modest starter fund doesn't usually win the spreadsheet. It buys insurance the spreadsheet doesn't price in.

Free and interactive — no sign-up, nothing to install. Read the full lesson for the plain-language explanation.