Can I include investments as part of my emergency fund?
Curious about emergency funds
While investments can be an important part of an overall financial plan, it is generally not advisable to consider them as a primary component of your emergency fund. This is because investments are subject to market fluctuations and may not be readily accessible when you need them the most.
An emergency fund should ideally be kept in a lowrisk, liquid account that can be easily accessed when needed. Examples of such accounts include highyield savings accounts, money market accounts, or certificates of deposit (CDs). These accounts typically offer relatively low interest rates, but they provide easy access to your funds in case of an emergency.
In short, it is generally recommended to keep your emergency fund separate from your investments, in a liquid account that is easily accessible. This can help ensure that you have sufficient funds available to cover unexpected expenses or a sudden loss of income.