SURVEY: Where Do You Stash Your Emergency Fund

[RatRaceBeGone]

I thought it would be interesting to compare how we stash our emergency cash.

I'll start.

We have a year's worth of basic living expenses in our EF. A month's worth is in an online savings account earning .9%, and the remainder is in a Vanguard bond fund.

[snshijuptr]

I have $2000 sitting in my checking and the rest of the 6 months + $10,000 for baby sitting in a savings account. I regularly check 6 month CD rates, but none are ever higher than my savings yield.

[BMEPhDinCO]

I have 6-9 months (depending on how tight we made it) plus other targeted savings in an online savings account. We also have our Roth as an emergency super emergency.

[disneysteve]

Ours is scattered around. We keep a cushion of a couple thousand in our checking account. I have a few money market accounts in various places. I have a CD that I roll over each year. I have some I bonds that are redeemable any time. I have some cash in my brokerage account. All together, it adds up to more than enough for any emergency.

[feh]

Online savings account (Redneck, earning slightly above 1%).

[bjl584]

I have some in checking and some in savings at my local bank. I also have a large chunk in my brokerage account.

[MonkeyMama]

I keep $1000 readily accessible at my credit union (Savings account, low interest).

About $10k in a ROTH, for now (MMMF-cash). About $20k in two high-yield savings accounts. I tend to jump around and chase rates a bit on those.

Historically I've had a lot more in CDs, but just don't see the point these days.

We keep some cash on hand for emergency, too. Maybe $200. I try to keep $20 in my wallet thought I never use cash. Never needed it, but you never know.

[Ima saver]

I have a local money market account that pays interest and the rest I put at ING electric checking that pays 9/10 of one percent.

[Slug]

I finally started an account officially called Emergency Fund that's got about $2k in it, but I have another ~$25k in various savings accounts that I can pull from. I would like the combined number to be something close to $40k. I'm unwilling to give funding 2 Roth's and maxing my 401k so that makes it harder to build the EF rapidly.

[Like2Plan]

We keep a buffer in a savings account, but the majority of our EF is in Savings Bonds.

[cypher1]

The majority is in ING account, with a couple thousand for short term/quick access in credit union savings.

[pdweaver]

I keep my 6 month reserve in a money market account at my primary bank. I like to have the ability to transfer this money to my checking account immediately.

I also like to keep a buffer in my checking account.

I keep the rest in my brokerage account.

[GREENBACK]

I keep it all in an online account. Interest rates are to low to hassle with numerous accounts at the moment.

[amarowsky]

Ever since I have been a member of this Forum though my different financial situations I have struggled to form an EF. But now I finally got one going pretty solid. But I though the whole reason of the EF was to have the money Immediate and next to as liquid as possible (in a bank/brokerage accnt) and Not in bond funds, roths or other taxvehicles, or stocks. And it seems the majority of you are only keeping 1-4k ready in an account and the remainder in vehicles or stock that would not consider it fairly liquid. You all have really suprised me.

Mine is in an online bank mainly @.85%, but its only about 1/3 of what its suppose to be yet, and i keep always 1+ months bills in my regular checking/savings.

[disneysteve]

Originally Posted by amarowsky

it seems the majority of you are only keeping 1-4k ready in an account and the remainder in vehicles or stock that would not consider it fairly liquid. You all have really suprised me.

Not a single response has mentioned keeping the EF in stocks so I'm not quite sure what you are referring to.

As for liquidity, that's a reasonable question. My feeling is that nothing would ever happen that would necessitate me having instant access to 6 months worth of expenses all at once. The main "emergency" that I feel our EF prepares us for is me losing my job. If that were to happen, I would need my EF to replace my income for however long I was out of work (last time was about 3 months and that was nearly 12 years ago). As long as I had some readily accessible money for day to day stuff, I'd have plenty of time to cash in an I bond or make a withdrawal from my brokerage account or whatever else I needed to do to keep the money flowing.

And there are always credit cards that can be used if I needed to cover a big expense urgently and didn't have the cash on hand for some reason. Between our 4 cards, we have nearly $100,000 in available credit. I can't imagine any emergency that would exceed that.

[feh]

Originally Posted by amarowsky

Ever since I have been a member of this Forum though my different financial situations I have struggled to form an EF. But now I finally got one going pretty solid. But I though the whole reason of the EF was to have the money Immediate and next to as liquid as possible (in a bank/brokerage accnt) and Not in bond funds, roths or other taxvehicles, or stocks. And it seems the majority of you are only keeping 1-4k ready in an account and the remainder in vehicles or stock that would not consider it fairly liquid. You all have really suprised me.

Mine is in an online bank mainly @.85%, but its only about 1/3 of what its suppose to be yet, and i keep always 1+ months bills in my regular checking/savings.

our entire EF is in an online savings acct - about 8 months worth of living expenses.

[kork13]

My EF is 5 months' expenses, which is my particular situation, is sufficient. I keep a $1k buffer in my checking account (earning just .05% interest -- laughable, really) for month-to-month variations and unanticipated expenses, $6k in an online savings account (1.1% interest) for most "minor" emergencies, and the rest in federal I-Bonds (currently between 3.1%-4.9% interest).

As you can see, I use a "tiered" approach to my EF, which I actually started using on recommendation from these boards. Most "emergencies" are small, occur infrequently, and I'm able to replace the money within a short period of time (if I use any of the $6k, replacing it becomes priority #1). So I have cash accounts to cover those small things. For all the rest, I-Bonds are great. At this point (after owning them for 1yr), I can cash them in at any time for only a minor interest penalty. After 5 years of owning them, the penalty goes away entirely. So the tiered approach offers security, but still provides decent returns on my money.

Besides, this way I've got my name on a (very very very very very very) small share of the federal debt.

[amarowsky]

Originally Posted by disneysteve

Not a single response has mentioned keeping the EF in stocks so I'm not quite sure what you are referring to.

As for liquidity, that's a reasonable question. My feeling is that nothing would ever happen that would necessitate me having instant access to 6 months worth of expenses all at once. The main "emergency" that I feel our EF prepares us for is me losing my job. If that were to happen, I would need my EF to replace my income for however long I was out of work (last time was about 3 months and that was nearly 12 years ago). As long as I had some readily accessible money for day to day stuff, I'd have plenty of time to cash in an I bond or make a withdrawal from my brokerage account or whatever else I needed to do to keep the money flowing.

And there are always credit cards that can be used if I needed to cover a big expense urgently and didn't have the cash on hand for some reason. Between our 4 cards, we have nearly $100,000 in available credit. I can't imagine any emergency that would exceed that.

I shouldn't have said stocks, I meant stock in investments other than just an interest yielding bank . But I was more speaking about how I thought this forum as a whole itentified the criterion for an Ef. I thought here it was suppose to be all liquid and seperate . Since starting mine I never intended on keeping it all seperate and liquid. Lol I justthought I was going against the grain .

[acat29020]

I just have mine in my savings accounts... and some in an IRA but i wouldn't consider that
"emergency" money.

[disneysteve]

Originally Posted by amarowsky

I shouldn't have said stocks, I meant stock in investments other than just an interest yielding bank . But I was more speaking about how I thought this forum as a whole itentified the criterion for an Ef. I thought here it was suppose to be all liquid and seperate . Since starting mine I never intended on keeping it all seperate and liquid. Lol I justthought I was going against the grain .

I see nothing wrong with having part of the EF in a safe vehicle that can't lose principal value. That could be a CD, savings bonds, money market account, etc. I'm not such a fan of a bond fund, which some people do use, because those can lose value.

As for "liquid", to me that doesn't mean I can get to all of it instantly. As long as I can access it quickly and with little to no penalty, that's liquid enough. I wouldn't want my EF to be the equity I have in a rental property, for example, because accessing it would mean either taking out a loan against that value or selling the property, either of which could be difficult or impossible depending on circumstances.