Scriptural Wisdom of Savings and Emergency Funds

Having a savings reserve is an important aspect of wise biblical money management.

In my opinion, you should maintain two separate and distinct savings acounts.  First, an emergency fund should be maitained for dealing with unexpected expenses such as a medical expense or auto repair bill or a temporary loss of income due to a layoff at work or a disabling injury. 
Second, a separate savings account should be set up with a plan to save for major expenditures that aren’t in your monthly budget, such as buying a newer car, new furniture, or a home remodeling project.

If you are very disciplined and good with financial matters, you could maintain one account and keep track of how much should be allocated to each of the above purposes. 

The following scriptural principles represent the biblical basis of maintaining a financial "cushion" in a savings account:

It reflects responsible preparation.

In the house of the wise are stores of choice food and oil, but a foolish man devours all he has. (Prov. 21:20)

Go to the ant, you sluggard; consider its way and be wise! It has no commander, no overseer or ruler, yet it stores its provisions in summer and gathers its food at harvest. (Prov. 6:6-8)

It reflects self-control.

Poverty and shame will come to him who neglects discipline, but he who regards reproof will be honored. (Prov. 13:18)

For the grace of God that brings salvation has appeared to all men. It teaches us to say “No” to ungodliness and worldly passions, and to live self-controlled, upright and godly lives in this present age. (Titus 2:11-12)

Deciding how large your savings account should be is up to you and your specific situation. Most financial planners recommend having 3-6 months’ living expenses set aside as an emergency fund. The amount is up to you, but living expenses for at least three months would be a good initial goal.   Don't forget to also add savings to accumulate funds for any large upcoming purchases, such as a vehicle.