Emergency Fund | TigerDroppings.com

Posted byMessage
nelatf
Louisiana Tech Fan
NELA
Member since Jan 2011
1133 posts
 Online 

Emergency Fund


I have my emergency fund fully funded - but it is sitting in a savings account earning nothing.

I am tempted to pull it over to my fidelity account and try to do a little better than savings account return.

What do you MB experts do with your emergency funds for a better return than a savings account?







Back to top
Share:
crazyhorsedog
Member since Feb 2014
110 posts

re: Emergency Fund


Peace of mind is worth more than cash value to me. I ensure I have 8k min in my checking by the time I'm paid.

10k is prob only 3 months expenses but I have a stable job and my wife could work asap if needed.






Back to top
  Replies (0)
foshizzle
LSU Fan
Washington DC metro
Member since Mar 2008
29976 posts

re: Emergency Fund


I put mine in a Roth IRA. The returns year over year aren't necessarily any better but the benefit comes about 15-20 years down the road because there is no tax at all.





Back to top
  Replies (0)
Volvagia
LSU Fan
Baton Rouge
Member since Mar 2006
40655 posts

re: Emergency Fund


I personally hate having money not working for me.

If you don't already have a Roth, use it for that.



After a few years, the accumulated gains will far offset losses you might incur if you happen to withdraw in the middle of a big downturn.



The key is to slowly phase it over. Don't dump all of your money in it at once, so part of it can build earnings without the full risk exposure.


Also, use a balanced fund, not all stock.

I use Vanguard's STAR fund.






Back to top
  Replies (0)
jso0003
Auburn Fan
Birmingham/Atlanta
Member since Jun 2009
4837 posts

re: Emergency Fund


Set up a seperate brokerage acct and throw it in some kinda ultra stable bond fund.





Back to top
  Replies (0)
756
LSU Fan
Member since Sep 2004
9582 posts

re: Emergency Fund


I suggest

Lord Abbott Fund






Back to top
  Replies (0)
reb13
Ole Miss Fan
Oxford, MS
Member since May 2010
9906 posts
 Online 

re: Emergency Fund


I do not understand the need for a savings account, what expense cannot be put on a credit card while you unwind your brokerage account? It takes what, 5 days max to get the money?





Back to top
HuntFishMan
Member since Feb 2014
238 posts

re: Emergency Fund


Day Trade





Back to top
  Replies (0)
Lsut81
USA Fan
Member since Jun 2005
64564 posts

re: Emergency Fund


quote:

I do not understand the need for a savings account, what expense cannot be put on a credit card while you unwind your brokerage account?


Never thought about it like that...


I def need to move some cash around...

I've got 8mo living in my savings, 8mo living in my checking, and about 5k in my frick You account.

My tax return along with a couple of nice paychecks have snuck up on me and I haven't had time to move it around.






Back to top
  Replies (0)
lsaltee
LSU Fan
poppin a tent, roastin marshmellows
Member since Sep 2007
2922 posts
 Online 

re: Emergency Fund


If you are in br, I think pelican credit union is giving 4% on up to 10k and a little less than 1% on anything over.





Back to top
  Replies (0)
Ace Midnight
LSU Fan
Ball, LA - Home, Sweet Home
Member since Dec 2006
29999 posts

re: Emergency Fund


quote:

I do not understand the need for a savings account, what expense cannot be put on a credit card while you unwind your brokerage account? It takes what, 5 days max to get the money?


It's a good point - the only thing that leans against that is some crippling financial crisis that affects the brokerage accounts (or freezes them) but doesn't affect FDIC accounts - at least not immediately.

Crazier things have happened. I'm only about $12k in savings - the balance of my "emergency" fund is in stocks. I'm going to move more of my actual "emergency fund" savings into a Vanguard vehicle - then just roll that into excess investment.






Back to top
Sigma
Michigan State Fan
Fairhope, AL
Member since Dec 2005
1933 posts
 Online 

re: Emergency Fund


VWINX





Back to top
  Replies (0)
Lsut81
USA Fan
Member since Jun 2005
64564 posts

re: Emergency Fund


quote:

the only thing that leans against that is some crippling financial crisis that affects the brokerage accounts (or freezes them) but doesn't affect FDIC accounts


Correct me if I'm wrong, but Brokerage accounts are also insured up to a $$$ amount...

So I highly doubt those would be frozen and FDIC insured account wouldn't






Back to top
foshizzle
LSU Fan
Washington DC metro
Member since Mar 2008
29976 posts

re: Emergency Fund


quote:

I do not understand the need for a savings account, what expense cannot be put on a credit card while you unwind your brokerage account? It takes what, 5 days max to get the money?



This is exactly what I do, and no I don't understand why anyone uses savings accounts these days either provided you can put it in a Roth, or in a brokerage account if you've run out of contribution limits everywhere else.






Back to top
Teddy Ruxpin
LSU Fan
New Orleans, LA
Member since Oct 2006
18892 posts
 Online 

re: Emergency Fund


quote:

This is exactly what I do, and no I don't understand why anyone uses savings accounts these days either provided you can put it in a Roth, or in a brokerage account if you've run out of contribution limits everywhere else.



Here's a question, because it is currently bothering the shite out of me. (I already max my 401k match and ROTH for both the fiancee and myself). Right now I have 10k in a "high yield" online savings account.

Where would you put house down payment savings? Looking to buy before 2017, most likely late 2015 or in 2016.



This post was edited on 3/19 at 1:15 pm


Back to top
barry
Cincinnati Fan
Location, Location, Location
Member since Aug 2006
38100 posts

re: Emergency Fund


I convinced my wife to put into a brokerage account. You really only need MAYBE a month in cash, everything else can be easily reached in that amount of time.





Back to top
Teddy Ruxpin
LSU Fan
New Orleans, LA
Member since Oct 2006
18892 posts
 Online 

re: Emergency Fund


quote:

I convinced my wife to put into a brokerage account. You really only need MAYBE a month in cash, everything else can be easily reached in that amount of time.



So go into a taxable investment account? Seems like the only option left besides where I'm currently located. Obviously, the risk is loss of principal, etc. etc. etc.

ETA: If I do this, I might have to move some stuff around for tax efficiency. Doesn't look like the popular options of STAR, Wellesley or Wellington look particularly efficient, but maybe I'm a dumby.



This post was edited on 3/19 at 1:46 pm


Back to top
TigeRoots
New Orleans Saints Fan
Member since Oct 2008
3638 posts

re: Emergency Fund


I have my emergency fund in an Individual investment account, which can be fully liquid within 5 days if need be. Obviously there is some risk involved, but I monitor it constantly.





Back to top
  Replies (0)
Ace Midnight
LSU Fan
Ball, LA - Home, Sweet Home
Member since Dec 2006
29999 posts

re: Emergency Fund


quote:

Correct me if I'm wrong, but Brokerage accounts are also insured up to a $$$ amount...


I don't think stocks, bonds and mutual funds are insured - maybe if your brokerage buys your CDs - those might qualify.

quote:

So I highly doubt those would be frozen and FDIC insured account wouldn't


You can't envision a situation where the trading floor and brokerage accounts are frozen, but ordinary deposit accounts remain active (for a while - no question a run will shut them down, too)? I agree that it appears unlikely, but certainly not unimaginable.






Back to top
Lsut81
USA Fan
Member since Jun 2005
64564 posts

re: Emergency Fund


quote:

The Securities Investors Protection Corporation (SIPC), a non government entity, replaces missing stocks and other securities in customer accounts held by its members up to $500,000, including up to $250,000 in cash, if a member brokerage or bank brokerage subsidiary fails.






Back to top


Back to top