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Most financial advisers give "X months of buffer of bare minimum". 3 and 6 are both bandied about 10k isn't ENOUGH in the bank IMO for most people living in SF
by gte910h 14y ago
Most financial advisers give "X months of buffer of bare minimum". 3 and 6 are both bandied about
10k isn't ENOUGH in the bank IMO for most people living in SF. It's probably closer to 20k, but 10k was just a random number I pulled out to demonstrate flexibility of cash on hand. Then again, CA has really tenant friendly eviction laws, so maybe not...
It doesn't have to be ACTUAL cash, just near cash holdings not strongly effected by volatile securities (such as the stock market)
- enraged_camel 14y ago3 to 6 months of living expenses would normally be sufficient to keep in the bank in a checking account. That said, we don't live in normal times. Considering the state of the economy, and how long it takes for those laid off to find new jobs, keeping 9 to 12 months of cushion is a better idea.
- gte910h 14y agoThere is no reason to keep more than 3 months in a checking account. Past that, CD it.
- bstpierre 14y agoI'd agree, except for the fact that recent typical CD rates aren't really much better than recent typical savings account rates. E.g. 0.80% on a savings account and 0.90% on a short-term CD. You can probably find better deals, but the amount of money you'll earn for the amount of effort you'll expend finding, opening, and maintaining the CDs probably makes it not a worthwhile exercise.