Question

Dylan’s essential (fixed) expenses are $900 per month, his essential (flexible) expenses are $400 per month, and his non-essential expenses are $295 per month. His 401-K retirement account has $12,000, and his emergency fund savings account has $3500. Dylan wants an emergency fund of 3 times monthly living expenses. How much more does Dylan need to save to have an adequate emergency fund?
a. $1,450
b. $5,200
c. $1,285
d. $8,500

Answer 1

The Following "Verified" Answer is wrong. On Financial Math the answer is...

C.

$1,285

Answer 2

Answer:

Option C. $1,285 more Dylan need to save.

Step-by-step explanation:

Dylan's essential (fixed) expenses = $900 per month

His essential (flexible) expenses = $400 per month

His non-essential expenses = $295 per month

Total expenses per month = 900 + 400 + 295 = $1595.00

He wants an emergency fund of 3 times monthly living expenses

= $1595 × 3 = $4,785.00

currently, in Dylan's emergency fund account = $3,500

Dylan need to save more = 4,785 - 3,500 = $1,285.00

Dylan need to save $1,285 more to have an adequate emergency fund.