I recently started questioning where I should stash my emergency fund. The past several years, my emergency fund was split between a couple high yield savings accounts. I also saved more than a year’s worth because well, I am not sure why.
I would love to hear where others are stashing their emergency fund.
Here are 4 thoughts that have been going through my head regarding my emergency fund:
- Keep my high yield savings accounts and reduce my emergency fund to 3 months max and consider reducing even further to around 1-2 months
- Put the excess amount from my high yield savings and put into Vanguard ETFs or a robo advisor.
- Put the excess amount and put it towards my student loan, which is now at $32,000 at around 5.2% interest rate.
- Keep all of it and redistribute to obtain my goal of buying my first investment property. This would allow me to increase my down payment or use the funds to make necessary upgrades.
I recently heard on various podcasts that emergency funds should be readily available so stocking this away in a high yield savings account might be better than putting this into a robo advisor or self directing the funds to an ETF.