Author Topic: Do you count wealthfront as liquid emergency fund?  (Read 431 times)

magnet18

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Do you count wealthfront as liquid emergency fund?
« on: September 05, 2019, 08:15:48 AM »
I used to keep around $10,000 on hand as an emergency fund in a savings account, but recently moved it to wealthfront high yield to get that sweet 2.x percent interest, leaving ~500-1000 in my daily credit union savings for immediate emergency needs, plus credit cards on hand.


Question, since it takes 1-3 days to get the money back to my daily credit union, would you still consider it an effective emergency fund?  Or would you be keeping it in something more liquid like Ally bank where I can get a checkbook?

My thoughts are in the event of a multi-thousand dollar emergency I can always use the credit card and then initiate the transfer, and pay it off in 1-3 days when the money clears, but I'm curious what other potentially more experienced mustachians may think

bw_94

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Re: Do you count wealthfront as liquid emergency fund?
« Reply #1 on: September 05, 2019, 08:55:29 AM »
I personally keep most of my emergency stash in a "high interest" account, but I also keep about $5-10k in my regular savings/checking accounts for more immediate emergencies. I'd definitely feel unsafe with only $500-$1000 in readily accessible cash, but, to each his own.

WSUCoug1994

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Re: Do you count wealthfront as liquid emergency fund?
« Reply #2 on: September 05, 2019, 09:30:04 AM »
I personally keep most of my emergency stash in a "high interest" account, but I also keep about $5-10k in my regular savings/checking accounts for more immediate emergencies. I'd definitely feel unsafe with only $500-$1000 in readily accessible cash, but, to each his own.

I have a similar approach - but to be honest it doesn't really make sense as I literally put everything on a credit card that would be considered emergency and that easily buys me up to 30 days to become liquid.

35andFI

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Re: Do you count wealthfront as liquid emergency fund?
« Reply #3 on: September 05, 2019, 11:55:04 AM »
I used to keep around $10,000 on hand as an emergency fund in a savings account, but recently moved it to wealthfront high yield to get that sweet 2.x percent interest, leaving ~500-1000 in my daily credit union savings for immediate emergency needs, plus credit cards on hand.
Good move. I do the same.

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Question, since it takes 1-3 days to get the money back to my daily credit union, would you still consider it an effective emergency fund?
Yes.

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My thoughts are in the event of a multi-thousand dollar emergency I can always use the credit card and then initiate the transfer, and pay it off in 1-3 days when the money clears, but I'm curious what other potentially more experienced mustachians may think
Sounds like a good plan to me. This is exactly what I do.

I keep $1,000 (about a month's worth of expenses) in my checking account, then an additional 2 months worth of expenses in wealthfront.

I also have plenty in a taxable account if I needed to tap into that.

All expenses are put onto credit cards and if cashflow doesn't pay them off, I can go to the wealthfront account or even the taxable account (which is unlikely).
« Last Edit: September 05, 2019, 11:57:13 AM by 35andFI »

Kayad

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Re: Do you count wealthfront as liquid emergency fund?
« Reply #4 on: September 08, 2019, 01:56:54 AM »
Yes.  Other than getting kidnapped for ransom, I canít imagine an emergency that requires boatloads of cash in less than 3 days.

magnet18

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Re: Do you count wealthfront as liquid emergency fund?
« Reply #5 on: September 08, 2019, 06:38:20 AM »
Cool, thanks all for chiming in

I also couldn't think of anything that requires a lot of immediate money where a credit card won't do, so I'll stop worrying about it