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Where Should I Keep My Emergency Fund?

It’s important to keep your emergency fund in a safe and easily accessible account.

The main purpose of an emergency fund is to give you a pot of money to pull from when an unplanned expense pops up. That’s why it’s important to keep this money:

  • Easily accessible
  • Safe and secure (no risk to the principal amount)
  • Separate from your everyday checking (this helps you avoid dipping into it for daily needs)
Key Takeaway: A savings or insured money market deposit account are good options for your emergency fund.
Portrait of Steve Georgoulakis
Tip from Steve Georgoulakis, CFP®

It’s tempting to squeeze out a larger return on your emergency fund by investing the money into something with a little more risk than a savings account or money market. However, this money is for emergencies, so focus on the return of your money, not a return on your money.