Hi everyone,
I’m just seeing where you guys keep your emergency fund to have a little growth (1-1.5%) for instant liquidity. Online banking accounts , MMA, etc.
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If you do have growth, what do you like and dislike about your choice overall
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I don’t know if Jeremy covers this or has covered this in a previous post but I wasn’t able to find one when searching for it.
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Thanks !
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Hey Chad, I use an online high yield savings account. Any one will do. I personally use Marcus by Goldman Sachs, but they’re all paying dirt cheap interest rates right now. Other good choices are Ally Bank and Capital One 360
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Hi! I use Capital One 360. I find the app to be easy to utilize as well. Any HYS accts would be optimal.
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My emergency fund is in my HELOC. In other words I don’t have a pile of money sitting around earning almost nothing. Instead I have a $250K line of credit that I can draw on if needed.
This allows me to maximize returns on investments. If I need to draw from the LOC then:
a) I can elect to pay off some or all of the emergency loan at a very low interest rate or,
b) I can cash out some of the investments I have to pay some or all of it off.
My investment returns will have grown more with this approach because the “emergency money” would have earned a decent rate, pre-emergency.
This violates conventional wisdom, but there is very little risk in doing it this way for someone with a decent net worth.
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Mine would be all my Credit Cards , which have almost no utilization since they are all paid in full.
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