Quote:
Originally Posted by Broken Arrow
WELLLL....
I agree with speed and liquidity, but I don't see why you can't make some interest off of it either.
My credit card is my short term emergency fund. It's also quick and I usually have more than enough time to transfer my money from a savings or MMA and have it paid off online. (I'm currently using a 5% checking, but that's beside the point.)
However, I also don't carry a balance, and I never charge more than I have in my bank account. So, this method may not be perfect for everyone.
There are other kinds of emergencies, such as natural disasters, where cash is probably the way to go.... But for everything else, there's MasterCard.  |
But you do have funds available in a MMA, correct? Just want to make sure you aren't advocating solely relying on your cc to be your EF. In my much more conservative opinion, that would be giving too much power to the credit card companies since they can close your account at any time.
My suggestion would be to start out keeping your EF in a high-yielding MMA. Once the balance is built up a bit, you could consider laddering CDs.