Tuesday, September 16, 2014

Investing our EF

I love the 15th of every month because its my commission check.  I usually have an idea of how much it will be but I eagerly check my bank account to see how much it actually is.  Yesterday's pay was good.  I earmarked $2500 to go to our new investment account.

My new plan for the investment account is to have at least 6 months of expenses between that account and our regular savings account.  We have a hard time keeping over $10,000 in our savings account because something always comes up.  The investment account will still be fairly liquid but not as easily accessible.  I want to get $24,000 between the two accounts for starters.  That would be 6 months of bare bones budget of $4000.  We had over $11,000 in our savings account and $8000 in our investment account before the new transfer.  

But wait?  One's EF is supposed to be liquid, not invested.  Yeah, but I'm okay with the added risk to make more money.  We still have our regular savings which I want to keep $10,000 in and we have our home equity line of credit with $28,500 available.  I think we can handle any of the small emergencies.

Is your EF completely liquid?  Do you think this is a silly idea?


  1. Not at all, we are the same way. I want to build that nice, fat emergency fund, but something always comes up. If we waited for it to get there, we might never invest. (no, I am not doing anything until we get debt paid off). Mr. Money Moustache does that, so I don't know why it would not work.

  2. This is a great idea. To me all investment accounts are emergency funds because in a real emergency situation I would not hesitate to sell some stocks :) The important thing is to have access to liquidity, which you have plenty of.

  3. Splitting your EF between totally liquid savings account and easily liquidated investment account is a good idea. We do the same sort of thing.....we have about $20K right now in the bank and the rest of our non-retirement money is invested. I do need to move some $ out of the bank though into invested funds. Thanks for the reminder!

  4. I presently keep a buffer of 1 month's expenses in our interest bearing checking account and 1 one month in savings, and then another 6 months in laddered CDs. However, as the CDs mature I am transferring the money to our investment account.

  5. I like your plan. We aren't there yet. We just have money in a regular savings account but the goal is to start an non retirement investment account as well.
    I get bonuses twice a year and it always feels like Christmas to me as I wait impatiently to get it. Is that how it feels for you every month?

    1. Not really. By the time that I've earned the commission, I've put in the work for months prior so it feels like a paycheck. But sometimes a fat paycheck!

  6. I grew up poor, poor, poor! I don't think my mom ever had $5.00 in the back, so i'm paranoid. I keep all our savings "easy" to go to. We use a TFSA for savings so if we had to pull it out, it wouldn't be taxed (already is). We have $20K that I could get within 24hrs if needed. I'm not a risk taker, so this works for me.

  7. No our emergency fund is $1000.00 liquid (not enough) and $3000.00 bonds in a safety deposit box. However every time I need to dip into the bonds I can't make myself? So is it truly an emergency fund?

  8. We keep our entire EF in a safety deposit box. This may not be the way everyone would do it but it helps me sleep at night. Plus in a pinch we could charge what we needed. We don't have any credit card debt so I could cover a large bill and then go to the bank.

  9. Our e fund is completely liquid. I want to be able to get the money the day I need it.
    We keep ours in a money market account in the bank. But, sometimes I get nervous about the bank, so we are looking to move it soon.