TOOLS / FOR SELLERS

How big a cushion you actually need

Self-employment means no paycheck to fall back on. Size the fund that lets a slow month stay a slow month instead of a crisis.

$
The bare minimum to keep the lights on — living costs plus fixed business costs.
A common floor is 3 months; 6 is safer for most solo businesses.
The choppier your income, the more months you should hold. This adds to your base buffer.
TARGET FUND$—
MONTHS OF RUNWAY—
SAVE / MONTH FOR 1 YR$—

How this is calculated

The target is your monthly expenses times the months you should hold:expenses × (base buffer + volatility months). Steadier income adds nothing; variable income adds a couple of months; feast-or-famine adds several, because the gap between good and bad stretches can be long. The save-per-month figure is simply the target spread over twelve months, so you can see the cushion as a habit rather than a wall.

This is the personal-finance side of the same idea as businessrunway — how long you can operate without new income. Keep it in a separate, boring, accessible account, and top it back up after you dip in. Smoothing the income that feeds it is acash flow problem worth solving alongside; when you're ready to see how many months your business itself could last, the runway calculator handles that view.