Where do you keep your emergency fund? - Mothering Forums

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#1 of 22 Old 06-26-2008, 02:02 PM - Thread Starter
 
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So, I'm about to the point where DH and I are going to start stocking away for a 6 month emergency fund. Partly, I'd like this money as a security blanket but partly we want to transition from me working PT and DH working FT to one of us working PT out of the house and both of us working at home (we blog and we both have careers we're trying to grow - I'm a photographer, he's a writer). Hopefully we'll be able to transition seamlessly without needing the funds but I want them there in case.

Finally, the question: Where do you put all that money? It seems like there must be a place other than a checking or savings account that will earn more interest but I want to have it available if we need it. How can I make this money grow if I'm not using it?

Should I have 3 months in a savings account and have the other 3 months more tied up at a higher interest rate but accessible should we run out of the first 3 months? HELP!

Thanks in advance!

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#2 of 22 Old 06-26-2008, 02:10 PM
 
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Interest rates aren't too good right now, but a money market account will get you the best rate. You can see who has the best rates right now at http://www.bankrate.com
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#3 of 22 Old 06-26-2008, 02:25 PM
 
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You can "ladder" CD's. Essentially, you break the total amount into parts. Keep 1 portion liquid in a money market or internet savings account (both are getting around 3-4% right now). Then buy CDs with the remainder so that a portion becomes available again every month (or few months). This keeps the money available, but also allows you to potentially get a higher interest rate.

If this isn't clear, PM me.

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#4 of 22 Old 06-26-2008, 02:25 PM
 
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:

I'm wondering the same thing! We've been building our em fund, and I'm not sure what to do with it. Right now we just have it in a savings account, but it's barely making anything on interest, so I'm sure it would be wiser to move it, but my main concern is that it still be accessible.

Thanks for asking this zmom, I can't wait to see the responses!

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#5 of 22 Old 06-26-2008, 02:52 PM
 
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We have ours in a high interest savings account. It's currently earning 3.55 (it was 5% when we started it ). We have easy access as we can just transfer the money online to our checking account, which we had to do this past month.
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#6 of 22 Old 06-26-2008, 03:22 PM
 
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It's in a money market account that we can write checks from.

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#7 of 22 Old 06-26-2008, 05:05 PM
 
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Ours is in an ING account. It gets way better interest than most and is pretty easy to get to if we need to. I've also put some of the EF into an ING cd before, when the interest rate was better than the savings account.

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#8 of 22 Old 06-26-2008, 05:30 PM
 
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Ditto the ING account here...

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(Sorry just wanted to use that new smilie) LOL
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#9 of 22 Old 06-26-2008, 05:44 PM
 
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we keep ours in an ING savings account, too.
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#10 of 22 Old 06-26-2008, 06:03 PM
 
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LOL, I totally thought you were asking people where in their house they kept their cash!!

We keep our emergency fund in cash. But I'm not saying where. And at the moment it is pitifully small, in case anyone is tempted to try and find it.

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#11 of 22 Old 06-26-2008, 06:23 PM
 
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We keep ours at ING.
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#12 of 22 Old 06-26-2008, 06:31 PM
 
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Quote:
Originally Posted by amyamanda View Post
LOL, I totally thought you were asking people where in their house they kept their cash!!

We keep our emergency fund in cash. But I'm not saying where. And at the moment it is pitifully small, in case anyone is tempted to try and find it.
Oh come on, you can trust us...

In all seriousness though, for those of you that keep your ef in savings/other accounts, do you keep any cash stashed just in case? I don't yet, but I've been thinking that it might be a good idea.

MJ~ Proud mom to DS (4)
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#13 of 22 Old 06-26-2008, 08:56 PM
 
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We have ours with HSBC. The rates have dropped dramatically over the past several months

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#14 of 22 Old 06-26-2008, 09:36 PM
 
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Right now we just have it in a savings account, but we are going to switch to ING soon.

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#15 of 22 Old 06-26-2008, 09:47 PM
 
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We keep it here: http://www.fordcredit.com/interestadvantage/index.jhtml

The rate is higher then ING (3.4 vs 3.0) and anyone can join. You can transfer money in and out as well as use checks.
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#16 of 22 Old 06-26-2008, 10:51 PM
 
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we are just getting started with this but until we have a decent amount it will stay in our money market checking account, just 'off the books' as it were {in other words it will be there, but it won't be in my check book balance so I don't get tempted to spend it} the checking account gets better returns than the savings account at this point since we are with a credit union and the size of our account determines our end of year share...
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#17 of 22 Old 06-26-2008, 10:55 PM
 
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A money market account that we have easy access to.
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#18 of 22 Old 06-26-2008, 11:36 PM
 
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We keep it in a money market account that we got through Costco.
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#19 of 22 Old 06-26-2008, 11:49 PM - Thread Starter
 
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Wow! Thanks for all the responses. We use ING already so maybe that's our best bet until we get enough saved up that we could dump them into the laddered CDs or something.

:

Unschooling mama to one 5 year old DD.
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#20 of 22 Old 06-27-2008, 12:15 AM
 
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We use the HSBC online savings account (http://www.hsbcdirect.com/1/2/1/defa...BUS_M1016406DK). It's rates are pretty close to a money market account but it's FDIC insured. We used to get 6% but now I think we get about 3.5%. I also like that we can transfer funds online from our savings account at our credit union.

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#21 of 22 Old 06-27-2008, 12:58 AM
 
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Our savings (which is mostly dedicated to a remodel we're getting bids on right now) is in a money market that, last I checked, was getting a bit over 4% (but it's north of $85k, which matters). It's set up through the brokerage attached to the accountant who handled my late cousin's finances. It all came from her estate, so we just kept it with the folks who had it, since they seemed to be doing a good job with it!

We've talked about putting a portion into a CD until we're starting construction, but never did get around to it, and we're sending the drawings out for bids right now, so we may need it in less than six months (and that's about the minimum time for a CD).

We had our down payment for our house in a "liquid CD" with CalNational, which was pretty cool. It's a CD, but slightly lower interest than most CDs, and it allows you to deposit or withdraw twice in the seven-month term without penalty. If you find you're using the second time, you can just withdraw it all and start a new one, so you'll never face a penalty.
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#22 of 22 Old 06-27-2008, 05:36 AM
 
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ING Account here as well. Earning around 3% - it used to be up to 4 or 4.5 dang it

We actually have quite a few of them. Here's our huge list:

Christmas Fund
  • $50 month = $600 year
  • Used to purchase all christmas gifts, goodies, decorations, etc with

Vacation Fund
  • $5 week = $260 year
  • used for mini vacations and overnighters during summer trips

Non Monthly Bills
  • $25 week = $1300 year - used for bills that come a couple times a year, plates & registration, trash, recycle, septic pumping, pest control, etc, etc, etc
  • So we don't have to scramble for money when the un-expected bill comes
  • This account has been a life-saver.
  • We simply took what we pay for each thing, for the entire year and then divide by 12 to see what the monthly payment would be if we had to pay it monthly, then add all the non-monthlies together to get how much you need each month and divide by your paychecks or weeks or whatever and just transfer - we don't even miss this anymore.

Kid's Activity Fund
  • $80 month = $960 year
  • used for kids to go to camp, and activities like dance, karate, gymnastics throughout the year

Walt Disney World Fund
  • $50 month = $600 year
  • obviously saving for the trip to Walt Disney World - hopefully by 2010 once the Harry Potter Park is open

Bankruptcy Fund
  • $1000 - just sitting there waiting until DH wants to file bankrutpcy
  • if for some reason he doesn't have to then we have an automatic emergency fund

Car Maintainance Fund
  • $20 month = $240 year
  • Used for oil changes, tune ups, small auto repairs and parts that don't qualfiy for use of emeregency fund

Emergency Fund
  • I try to have $1000 in this at all times, but it's only got $250 or so now.
  • We usually fund this is tax returns in spring
  • We sure missed this $$ last year - we had too many emeregencies and some went on Credit Cards
  • This is so we don't have to use the credit cards

Savings for Extras
  • $3 week = $156
  • Used for extras when we need a little boost in one catagory or another

Personal Savings Accounts for Each Child (3 DDs, and DSS)
  • 8.33 month on each child's birthday = $100 year for each child
  • Hope to save money saved for them for fun money when they're 18
  • car, college, trip tp europe - with interest hopefully it will just grow bigger and bigger

Health Savings Fund
  • $50 month = $600 year
  • I just started this, to pay for prescriptions, and everything up to our $500 person / $1000 family deductible
  • Might have to increase it depending on what type of insurance I get when I find a new job

I like the idea of some in the money market account to earn more interest but still be able to get to the $$ at certain times if needed.

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