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Originally Posted by Cranberry Tea
Any good bond funds that can be easily cashed out in an emergency that you'd recommend for this purpose? I feel like I'll go on tilt if I just have big piles of cash sitting in a savings account not being productive.
I know someone already posted...but honestly, anything investment grade or better with a short term focus would be a decent option imo. Gov't securities should be marginally safer / less volatile than Investment-grade...obviously with a slightly lower return.
Here's a listing of all the Vanguard Mutual funds...ETF is obviously totally fine. There's just more options to look at in the Mutual fund format. I'd probably go with an ETF personally...the major mutual funds are available in that format.
https://investor.vanguard.com/mutual...th-end-returns
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Originally Posted by jjshabado
So in your case, I'm curious how long it would take you to save ~3 months of living expenses? If your fixed expenses eat up something like 90% of your income, it may make sense to have an emergency fund. But if your fixed expenses eat up something like 50% of your income or less, it just doesn't seem like its necessary.
That being said, I get the "peace of mind" argument.
My income is chunky throughout the year. I get paid a salary that we can live off and then I see business profits as income at other points during the year. So, while it wouldn't take me long to save another 3 months in the scheme of total income, the irregular income also makes me like to have a chunk of cash readily available. The points are valid...i could pretty much in every case wait the 5 days it would take to liquidate a bond fund if i needed to.
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Originally Posted by DTEJD1997
Hey all:
Relying on credit as your "emergency fund" is an extremely foolish thing to do in my opinion...
If the power is out, what do you do? You NEED CASH. I've been through hurricanes, tornadoes, power outages, etc, and when the power is out, YOU NEED CASH.
Another potential problem is what happens if the magnetic strip on your credit card gets damaged? Then the machine can't read it and your are out of luck.
What happens if there is a hold on your account? Identity theft? Server SNAFU?
With cash, you simply don't have any of these problems. There is no counter party risk. You've got cash, you are good to go.
Credit/debit cards work fine the vast majority of time, but I've had numerous times when they didn't. Heck, just yesterday was one of those times. High winds in my area cut power to a lot homes/businesses. I needed to make a purchase and the merchant was taking cash only.
Always keep a couple of hundred in your wallet, have a couple thousand hidden at home and you are likely set.
To be extra safe, I would also keep an amount of physical silver/gold and a stash of food/water.
Chuckled at this. I'm definitely not in the doomsday prepper camp. I don't own any silver/gold at all, and wouldn't recommend that to anyone.
My ~3 months of expenses is clearly in a bank account, not physical cash, so in a 'society collapse' or 'disaster' scenario, I'm not getting immediate access to it. I probably do have a grand of cash at home at any time tho. Poker player habits die hard.