Where's your emergency fund?

[GoodLiving]

I've got about a years worth of living expenses in a high yield savings account which we all know is not earning very much these days. I was thinking of taking half out to try and invest it a bit higher than what I'm getting. I would hope to still keep it in a relatively liquid account. If I burned through the 6 months then I would access it. What do you do with your emergency funds? How many months do you have in liquid accounts? We're a single income two person family with no debt including mortgage.

[disneysteve]

We have cash or cash equivalents in a number of places. We keep a buffer of a few thousand in our checking account. We have a bunch in our online savings account as well as 2 CDs there. We have a number of I bonds purchased years ago. And there's some cash scattered in a couple of non-retirement investment accounts.

[Jluke]

Maybe you are at the point where you need to re-think your emergency fund strategy.

are you maxing out any retirement accounts? 19.5k is the max for a 401k. There is also a catch up for 50 and over.

are you doing that?

I know when I felt like I had too much cash I started to max my 401k (always maxed the Roth) and that solved my problem.

If you pull some money to invest in a taxable account t, what is your plan? Individual stocks, mutual fund/ETF. Are you in a high bracket that you might prefer a tax efficient fund(s)?

[kork13]

Currently, our defined EF (6 months) is split with ~4 months in an online savings account, and ~2 months in newly-acquired I-Bonds (taking advantage of generally higher interest that is inflation-protected). I'll most likely move another 2 months' worth into I-Bonds next year.

Beyond that, I keep 2-3 weeks' expenses of float as a minimum checking account balance, and have another ~1 year's worth held in cash savings, just as sinking funds for travel, taxes, future car purchases, and general savings. It's hefty, but it's simple & works for us... If there's a large drop in the markets, I might move up to half of that cash into our taxable mutual funds... but we're comfortable leaving plenty in cash, knowing that we have plenty of investments doing good work for us elsewhere. If something drastic happened, I could always tap our taxable investments as a fallback for cash as well.

Our normal living expenses are relatively low with no debt/mortgage & a somewhat frugal but comfortable lifestyle -- living expenses are only ~25% of our monthly after-tax income, allowing us to save very aggressively & give generously.

[Nutria]

Up until the beginning of this year, it's been in a bunch of $1000 twelve-month CDs spread evenly throughout the year. Since then, each month as they come up for renewal (at significantly lower rates), I'm moving half of them into the VWITX munis fund. So far it's yielded about 2.4%.

If interest rates go up, it "mathematically" won't decline too much, and the higher yield means the price will eventually rebound.

[bjl584]

Everywhere lol.
I have cash in multiple accounts.
Earning more on it isn't really the point.
It's more just security for me.
And it's such a small portion of my overall portfolio that I'm not overly concerned about the return.

[LivingAlmostLarge]

Capital One savings and I bonds. I have 6 months I bonds which I don't really think or access and 4 months Capital one and sink funds are probably another 4-6 months.