Caleb Hammer says Dave Ramsey’s $1,000 emergency fund rule is outdated. Codie Sanchez: What do you disagree with Dave Ramsey on? Caleb Hammer: Overall, I think Dave Ramsey has helped millions of Americans. His positive impact has been far greater than the negative. Caleb Hammer: But sticking to a... $1,000 emergency fund today is kind of crazy. Caleb Hammer: If you just adjusted it for inflation, it’d be around $3,000 now. Caleb Hammer: I’ve had people follow the $1,000 rule, then an emergency happened… Caleb Hammer: It wasn’t enough, so they went right back into debt and made the debt snowball even worse. Caleb Hammer: That’s why I recommend saving at least one month’s expenses before aggressively paying off debt. Caleb Hammer: Or at the very least, have enough to cover your highest insurance deductible. Caleb Hammer: That’s how you stop one emergency from turning into a financial disaster.show more

a thousand dollar is not enough as an emergency fund fr

i think so too

The $1,000 rule made sense then. Today, it needs an update.

i agree with you

There should be adjustments we’re in 2026

exactly

that is the starter emergency fund, he actually say 3-6 months is what you need

@oluwatxsinn most people don’t know that

Ya’ll are out of date on this.. the fully funded emergency fund per @DaveRamsey is now 6-9 months worth of expenses call it 20k. They agree that 1k isnt enough.. neither is 3k or 5k. Most emergencies you will be financing some way shape or form until youbhabe realistically 10k

dave has done multiple videos on this, it was never meant to be enough as a true emergency fund. its just enough so small unexpected expenses dont de-rail progress. 3-6months of expenses is the goal for an emergency fund. most people buried in debt cant get there without chipping away at debt first. hence the 1k

does people really consider $1k as an emergency fund?

i don’t think so

$1k is a whole lot if we’re being serious

@oluwatxsinn a whole lot of what??

$1000 is not supposed to be enough. $1000 is for a starter emergency fund while you pay off all non-mortgage debt. After you pay off all non-mortgage debt, the guidance is to have an emergency fund based on 3-6 months of expenses.

Yeah he's right about this fr

$1000 was baby step 1. The first thing you did. At no point did Dave Ramsey suggest it was a sufficient emergency fund. A fully funded emergency fund is 3-6 months of expenses Dave deserves better haters, man. At least listen to his show once or twice before opining.

Except Dave's rule isn't $1000, it's 3-6 months of living expenses.

Essentially, all Caleb is saying is reverse Dave's steps 2 and 3. BTW Dave does fully support people choosing to go over the $1k first step. Important context, he's not telling you exactly what to do, he's giving you guidance. You have to make the decisions

Unless Dave Ramsey changed his plan, I read his book and his emergency fund rules are 3 months of expenses saved up if you have no kids and 6 months if you have a. Family. I read the book in 2019 so maybe it changed since then but I doubt he would stick to a hard number like 1000

Ft. @Codie_Sanchez | @sircalebhammer

Dave Ramsey has constantly said 1k is just the start.

He doesn’t understand Ramsey then. Dave says that’s just a starting point and when you reach that you will learn to save and save more. The point is to start small yo create a habit

@sircalebhammer 💯 outdated, along with some of Ramsey’s other advice. An emergency fund depends on monthly spend and general liability exposure. For example, my young adult son’s emergency fund might be ok at $1k, but I’m uncomfortable with anything less than $10k in liquidity.

Caleb Hammer has no credentials to be giving financial advice. He is a podcaster who (somehow) became well known for having people talk about their personal finances and making them look stupid.

It never was meant to be enough 🙄 It’s meant as a step forward to change your outlook on money. Good news: “3-6 months of expenses” as a real emergency fund is inflation proof.

You're supposed to keep building the emergency fund as you go. The 1k is just to get you started. Once you reach steps 6 and 7, you should have half a year to one year worth of money (to pay all your bills). Me and my wife have 65k in our emergency fund. That's enough to pay our bills and then some for one full year while we get back on our feet. We also don't have debt or a mortgage so there's that too.

too much inflation, so yeah it's outdated

outdated fr

Key point not discussed: the real people Dave talks to and is trying to help have almost NOTHING saved. The point of the $1,000, as Dave has stated, is not the amount, as much as the learned skill of saving and budgeting. The $1,000 is the first step and proof you can do it.

1 month expense emergency fund is needed. even if you can claim disability or unemployment that can cover at least close to half you need at least a months worth of bills saved.

That's 2,000 more that they're saving just to start an emergency fund and not pay off debt while saving for the EF. Or they could use an EF at $1,000 and just start paying off debt... Either way you're not worse off. The whole point is to keep grinding it

Big fan of both Ramsey and Caleb here. I think Ramsey IS a bit outdated in general, and that would explain all of Caleb's criticisms. I think Ramsey's biggest appeal is still the stories - people with zero financial sense or future following his program and becoming wealthy

$1,000 emergency fund is to start with. Then grow it to 3-6 months expenses as youbwork through the steps.....

Inflation really changed the game

yeah fr

Caylon: this Caylon: was Caylon: a Caylon: good Caylon: post Caylon: I Caylon: enjoyed Caylon: it

Okay, but Dave himself agrees and he's said this. The point is mainly to get the ball rolling. It's like how he also mentions that the "Debt Snowball" system isn't the technically optimal one, but it's to boost morale.

Well even Dave Ramsey has said himself that the initial $1,000 isn't really meant to fix much of anything. It's meant to be a starter so it proves you can save mine, and then it gives you momentum for saving more..

That’s not his emergency fund. He says to start with that and then build it to 3-6 months of expenses. He says just do that if you can’t do more

@sircalebhammer It’s a starter emergency fund of 1k in baby step 1. The full emergency fund is built in baby step 3. But a 1k starter emergency fund is too low.

Even the 4 percent guy raised it to 5

He’s right. $1,000 isn’t enough today. However, many don’t even have that much set aside. $3,000 is a start; but, for many, they have never seen that much in a bank account or an envelope. Start where you can.