Where should I keep my emergency fund?

[FIREseeker]

For some reason I just HATE having liquid assets. They don't accrue much interest and that just feels like dead weight to me. Is there any other place you guys who recommend I keep my 'emergency' fund?

I have a few good sources of income so I don't feel I need a big fund. My expenses are also super low. I want about $15k for emergencies.

Credit cards? CD's which I can just take a hit on if I need them before they expire??

[rennigade]

Invest it in some low cost index funds vanguard has to offer. I have my cash in an online savings account earning 1% interest...although ive slowly been funneling money from my savings to vanguard index funds.

[avil_saver36]

- Capital One has an essential savings account that gives 1.24% interest. It's better than nothing.

- In some countries, you can keep dollar denominated accounts and get an interest of > 4% on 5 year CDs. We have banks in the country we were born in, and we get close to 5% interest on our dollar denominated CDs. If you have an option like that, explore it.

- You could put $5500 per year in Roth accounts and invest. The principal amount is available for withdrawal any time.

I personally do not keep any "emergency fund". If I had spare money, I will throw it to my mortgage. If your mortgage is around 4%, that's a guaranteed 4% return on money. The more you can pay off your mortgage, the more amount you can borrow in home equity should a real emergency need you plenty of sudden cash. In Maryland, state employees credit union can give you a HELOC loan at 0 closing cost and 0.99% 12-month introductory APR. That's an unbeatable offer - as good as it gets. The variable rate is also indexed to the prime rate, and the prime rate is unlikely to change any time soon. The cost to borrow money is so cheap that keeping cash around without any interest does not make much sense.

[feh]

For some reason I just HATE having liquid assets. They don't accrue much interest and that just feels like dead weight to me. Is there any other place you guys who recommend I keep my 'emergency' fund?

I have a few good sources of income so I don't feel I need a big fund. My expenses are also super low. I want about $15k for emergencies.

Credit cards? CD's which I can just take a hit on if I need them before they expire??

Your EF should be liquid, and not susceptible to declines in value (that means mutual funds are out).

Just stick w/ an online savings account. Yes, you'll only earn 1%, but for such a small amount of money, it doesn't matter.

Also - do a search. This topic has been discussed many times.

[FIREseeker]

- Capital One has an essential savings account that gives 1.24% interest. It's better than nothing.

- In some countries, you can keep dollar denominated accounts and get an interest of > 4% on 5 year CDs. We have banks in the country we were born in, and we get close to 5% interest on our dollar denominated CDs. If you have an option like that, explore it.

- You could put $5500 per year in Roth accounts and invest. The principal amount is available for withdrawal any time.

I personally do not keep any "emergency fund". If I had spare money, I will throw it to my mortgage. If your mortgage is around 4%, that's a guaranteed 4% return on money. The more you can pay off your mortgage, the more amount you can borrow in home equity should a real emergency need you plenty of sudden cash. In Maryland, state employees credit union can give you a HELOC loan at 0 closing cost and 0.99% 12-month introductory APR. That's an unbeatable offer - as good as it gets. The variable rate is also indexed to the prime rate, and the prime rate is unlikely to change any time soon. The cost to borrow money is so cheap that keeping cash around without any interest does not make much sense.

I've never heard of 'dollar denominated accounts. Will definitely look into them.