Question about investing home maintenance fund

[nwhiker]

So a little about my situation.  My wife and I are purchasing a home and are planning to save 3% per year for maintenance. From a financial perspective we currently are putting 10% in our 401(k) with company matches. Now that we don't have to save for the down payment and we don't have childcare this is going to free up $3,250 in our monthly budget. Our plan is to start a Roth IRA and max those out. Rather than having the fund sitting in a saving account I was looking to open a Vanguard taxable account to put the funds in too. Is there any thoughts on whether this is advisable?

[freedcorporateslave]

Personally I like to keep my non IRA funds in a Vanguard tax free municipal bond fund. I believe their bond funds also have check writing ability too.

[GreatLaker]

I do something similar, although not exactly the same. I am retired so I try to keep funds for major maintenance expenses available.

I have a savings fund that I keep in a balanced mutual fund in my taxable brokerage account. Keeping it in the balanced mutual fund gives moderate growth potential, low volatility and enables me to keep the amount separate from other funds in the account.

My savings fund is designed to cover replacement costs for car, roof, driveway, HVAC and major appliances. I estimated replacement cost and typical live expectancy for each item and it came to a savings amount of $5k/yr. I also keep a couple of thousand in cash in a HISA. If something like a fridge broke during a major bear market I could pull money out of my emergency fund rather than sell the mutual fund.

I cover smaller home maintenance like painting, plumbing repairs, furnace inspections/repairs etc from my regular annual budget, since those items are usually small enough to cover from general cash flow.