Emergency Fund vs. Savings

iVillage Member
Registered: 02-11-2008
Emergency Fund vs. Savings
8
Wed, 09-30-2009 - 10:22am

Do you have 2 seperate accounts for your savings account and your EF? I currently have 1 account for this. I'm starting to think I need a seperate account for just savings! Maybe I'm making things difficult for myself.


What's your opinion?


In the end I guess it wouldn't matter. If something extreme were to happen, money is money regardless of what "title" I have on those funds.


 

      

iVillage Member
Registered: 03-27-2005
Wed, 09-30-2009 - 10:37am

I have one account for my emergency fund and my sinking funds.

stacy

iVillage Member
Registered: 07-25-2008
Wed, 09-30-2009 - 2:51pm
This is a great question....I just have one account right now. You could always keep the funds separate on paper if you wanted them in the same account. Idealy, I think, one should be immediately accessible and the other somewhat so, if that makes any sense.

Amanda

Avatar for lucy4980
iVillage Member
Registered: 03-26-2003
Wed, 09-30-2009 - 7:09pm

We have multiple accounts for different purposes.

iVillage Member
Registered: 01-12-2008
Wed, 09-30-2009 - 9:32pm
We have one account. Though we dont touch it unless it is an emergancy. The "other" savings we have are at home in the safe in envelopes. They include the Christmas fund, and currently the t.v. fund. After we move I;m starting a vacation fund.
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iVillage Member
Registered: 08-04-2008
Thu, 10-01-2009 - 7:32am

I like having many separate accounts to keep track of the various types of savings: baby EF (overdraft), short-term goals, EF, and retirement.

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iVillage Member
Registered: 01-27-2009
Mon, 12-28-2009 - 3:41pm

I have several accounts with different purposes. I could never make the ledgers to keep track of what-is-what work.

I don't think any method is better than another (some would argue you get more interest with one but that depends on the bank and is often negligible.) I think it depends more on what works with your personality.

For me, I am usually thought of as organized but I am very aware that I require all of these external measures to do it. I have lists and ledgers and files and labels, etc. I need lists and visual reminders to get things done. As such, I needed the external structure of multiple accounts to keep going. My family says I make my banking complicated but when I try to help my mother with hers, I find her 2 accounts (chequing and savings) too complicated to figure out how much she has for what.

To each their own.

iVillage Member
Registered: 01-27-2009
Mon, 12-28-2009 - 3:46pm

I just mentioned this thread to my Mom and she had an interesting point:

She said she is keeping this separately for morale issues. When they are all in the same account, the account balance goes up and down and they don't make her feel good. As well, when she has things is separate accounts or "jars," she purposefully doesn't include the ones that go up and down (e.g. sinking funds) in her net worth calculations because they aren't meant to be a part of her worth AND it means that usually she has a slow-but-steady incline in her worth.

So your decision might want to include motivation and less tangible factors as well.

iVillage Member
Registered: 08-04-2008
Mon, 12-28-2009 - 5:59pm

Hi! That's a great point. Suze Orman gives this advice about choosing an investment vehicle: you might make more money in a risky fund, but if the fear of losing the money keeps you up at night and worries you sick all day, you're better off not taking the risk. Maybe not mathematically, but emotionally.


We don't talk a lot about investing here on the Budgeting board - I don't b/c I'm certainly no expert - but I know it's a sooooooooo important to diversify. That's one reason why DH and I have so many separate savings accounts. If we lose one, we will not have lost everything. Think of all those people who were financially ruined because they had all their money in one

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